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REPORT  OF  THE  JOINT  NEW  ENGLAND 
RAILROAD  COMMITTEE 


TO  THE 

GOVERNORS  OF  THE  NEW  ENGLAND  STATES 


MAINE: 

Honorable  Percival  P.  Baxter 

NEW  HAMPSHIRE: 

Honorable  Fred  H.  Brown 

VERMONT: 

Honorable  Redfield  Proctor 


MASSACHUSETTS: 

Honorable  Channing  H.  Cox 

RHODE  ISLAND: 

Honorable  William  S.  Flynn 

CONNECTICUT: 

Honorable  Charles  A.  Templeton 


REHABILITATION  BY  CO-OPERATION 

A  RAILROAD  POLICY  FOR  NEW  ENGLAND 


JUNE,  1923 


A  limited  number  of  copies  of  this  report  are  avail¬ 
able  and  will  be  sent  upon  written  request  to  the  chair¬ 
man  of  the  committee  for  your  state. 

Maine 

Hon.  Carl  E.  Milliken,  Chairman,  Augusta, 
Maine. 

New  Hampshire 

Lester  F.  Thurber,  Chairman,  Second  National 
Bank,  Nashua,  N.  H. 

Vermont 

James  F.  Dewey,  Chairman,  Quechee,  Vermont. 

Massachusetts 

James  J.  Storrow,  Chairman,  44  State  St.,  Bos¬ 
ton,  Mass. 

Rhode  Island 

George  L.  Crooker,  Chairman,  Providence,  R.  I. 

Connecticut 

E.  Kent  Hubbard,  Chairman,  Hartford,  Conn. 


Maps  will  be  sent  upon  request 


YW^m  \. 

AW  A  g 


REPORT  OF  JOINT  NEW  ENGLAND  RAIL¬ 
ROAD  COMMITTEE  TO  THE  GOVERNORS 
OF  THE  NEW  ENGLAND  STATES 


TABLE  OF  CONTENTS 

Page 

Rehabilitation  by  Cooperation  —  A  Railroad  Policy 

for  New  England .  1 

Appointment  of  Committee .  1 

Advisory  Technical  Staff .  2 

Procedure  Followed  by  Committee .  3 

The  New  England  Railroads  as  a  Group .  6 

General  Description .  6 

Ton  Miles  and  Passenger  Miles  of  New  England  Rail¬ 
roads  1903-1922  7 

Interchange  with  Connecting  Lines .  9 

Character  of  Traffic .  10 

Importance  of  New  England’s  Water  Transportation  11 

Pacific  Coast  Lines .  12 

Coastwise  Steamship  Lines .  13 

Foreign  Commerce .  14 

Volume  of  Waterborne  Traffic  .  15 

Coastwise  Merchandise  Movement .  16 

Topography  of  New  England  Railroads .  17 

Ton  Miles  and  Passenger  Miles  of  Each  New  England 

Road .  19 

Freight  Earnings  Depend  upon  Keeping  Cars  Moving  .  20 


11 


CONTENTS 


Page 

New  Haven  Railroad  . .  22 

Operation .  22 

Average  Daily  Movement  of  Freight  Cars  ....  22 

The  Cost  of  Slow  Movement  of  Freight  Cars  ...  24 

Delays  in  Classification  Yards .  25 

Comparison  with  Boston  &  Albany .  30 

Comparison  with  Boston  &  Maine .  31 

Time  Lost  in  Placing  Cars .  31 

Embargoes .  32 

Embargo  Policy  of  New  Haven  Railroad .  36 

New  Haven’s  Large  Per  Diem  Payments .  39 

Net  Ton  Miles  Per  Car  Day .  41 

Passenger  Operation .  42 

Locomotive  Repairs .  43 

Constructive  Mileage .  46 

Overtime  Pay .  48 

Materials  and  Supplies .  49 

Physical  Condition .  50 

Density .  51 

Future  Capital  Expenditures .  51 

Financial  Condition  of  the  New  Haven .  53 

Period  of  Expansion,  1902-1913  .  53 

Amount  of  Investment  in  Outside  Properties  ....  55 

Losses  of  New  Haven  on  Outside  Investments  .  .  57 

Amount  of  Increase  in  Capitalization  due  to  Outside 

Investments .  62 

The  Government  Loans  . .  63 

Increase  in  Physical  Valuation  Does  Not  Help  Road’s 

Earning  Power .  63 

Earnings .  65 

(Exhibit  A  Condensed  Income  Account  1908-1922) 

Growth  of  Traffic .  65 

Comparison  of  Years  1922  and  1912 .  66 

Comparative  Expense  Ratios  1908-1922  .  69 


CONTENTS 


111 


Page 


Results  for  First  Four  Months  of  Current  Year  .  .  .  69 

Poor  Outlook  for  1923  .  70 

Early  Maturities  of  New  Haven  Debt .  71 

Restoration  of  New  Haven’s  Credit  Imperative  ...  73 

Boston  &  Maine  Railroad .  74 

General  Description .  74 

Physical  Condition .  75 

Boston  Freight  Terminals .  77 

Shops  and  Roundhouses .  77 

Operation .  78 

Car  Miles  Per  Car  Day .  78 

Car  Delays  in  Yards  at  Mechanicville,  Rotterdam 

Junction,  East  Deerfield  and  Ayer .  79 

Cars  Moved  Daily  .  . .  82 

Embargo  Policy  of  Boston  &  Maine .  83 

Materials  and  Supplies .  87 

Locomotive  Repairs .  88 

Density .  89 

Financial  Condition  of  the  Boston  &  Maine .  90 

Earnings .  90 

(Exhibit  B  Condensed  Income  Account  1908-1922) 

Growth  of  Traffic .  90 

Comparison  of  Results  of  1922  with  1916 .  91 

Comparative  Expense  Ratios,  1908-1922  .  93 

Results  of  Operation  First  Four  Months  of  1923  .  .  94 

Financial  Outlook  for  1923  .  96 

Boston  &  Albany  Railroad .  97 

Freight  Car  Movement . .  .  99 

Net  Ton  Miles  Per  Car  Day .  99 

Percentage  of  Gars  Moved  Daily . 100 

Yard  and  Terminal  Operation  . 100 

Embargo  Policy . 101 

Locomotive  Repairs . 104 


IV 


CONTENTS 


Page 

Maine  Central  Railroad . - .  - . 106 

General  Description . 106 

Operation . 108 

Locomotive  Repairs . 110 

Financial . 110 

Bangor  &  Aroostook  Railroad  . 113 

Grand  Trunk  Railroad . 116 

Central  V ermont  Railway . 116 

Grand  Trunk  Extension  to  Providence . 118 

Importance  of  Canadian  Routes . 118 

Atlantic  &  St.  Lawrence  Railroad . 120 

Rutland  Railroad . 122 

Canadian  Pacific  Railway . 124 

Passenger  Traffic  of  New  England  Roads . 125 

Growth  of  Passenger  Traffic . 126 

Commutation  Passenger  Traffic . 128 

Mail  and  Express . 129 

Motor  Truck  Transportation . 130 

New  England  Port  Development . 134 

Development  of  Water  Transportation  Fundamental  .  134 

New  England  Railroads  Need  More  Export  Freight  .  .  135 

Enlargement  of  Welland  Canal . 136 

Advice  of  Expert  on  Port  Development . 138 

Portland  . 138 

Providence . 139 

New  London . 140 

Modern  Port  Development . 140 

Boston . 142 

The  Cowie  Plan . 142 

Necessity  for  Coordination  of  Boston  Terminals  .  .  .  145 


CONTENTS 


v 


Page 

Tentative  Consolidation  Plan  of  the  Interstate  Com¬ 
merce  Commission . 147 

Alternative  New  England  Plans . 147 

Treatment  of  the  New  Haven  under  Trunk  Line  Plan  .  149 

Comparison  Between  Allocating  the  New  Haven  to  (1) 

The  Baltimore  &  Ohio  or  (2)  The  Pennsylvania  .  .  149 

Coal  Movement . 150 

Comparative  New  Haven  Interchange  with  Penn¬ 
sylvania  and  Baltimore  &  Ohio . 153 

Consolidation  with  Baltimore  &  Ohio  Neither  Logical 

nor  Natural . 154 

Position  of  Baltimore  &  Ohio  as  to  Consolidation  with 

New  Haven . 155 

Consolidation  with  Pennsylvania  Natural  and  Logical  156 
The  Proposal  to  Allocate  the  New  Haven  to  a  Possible 
Delaware,  Lackawanna  &  Western  —  Nickel  Plate 

Consolidation . 159 

Trunk  Line  Consolidations  for  Northern  New  England  159 
The  Proposal  to  Allocate  Northern  New  England  Rail¬ 
roads  to  the  New  York  Central . 160 

Views  of  Trunk  Line  Presidents  on  Disposition  of 

Northern  New  England  Roads . 162 

Views  of  President  Rea  and  President  Willard  on  Im¬ 
portance  of  Maintaining  Free  Routing  in  New  Eng¬ 
land  . 168 

The  Fear  that  a  New  England  Group  Would  Have  too 
Great  Power  in  Dealing  with  Trunk  Lines . 174 

Importance  of  Canadian  Gateways . 179 

Trunk  Line  Control  Would  Endanger  Canadian  Gate¬ 
ways  . 182 

President  Hustis  Emphasizes  Importance  of  Canadian 

Gateways . 183 

President  Pearson  on  Effect  of  Trunk  Line  Control  upon 

Free  Routing  of  New  England  Traffic . 184 

View  of  President  Todd . 186 

Differential  Routes  to  West  and  South  Would  be  En¬ 
dangered  by  Trunk  Line  Consolidation . 188 


VI 


CONTENTS 


Page 

Boston  &  Maine  Should  not  be  Dismembered  ....  189 

Tentative  Alternative  —  “System  7A  —  New  Eng¬ 
land  -  Great  Lakes . 189 

Disposition  of  Rutland  Railroad  . 190 

Argument  for  Trunk  Line  Consolidation . 191 

A  New  England  System  Preferred . 192 

Railroad  Management  in  New  England  Must  be 
Sympathetic  to  Development  of  New  England  Sea¬ 
ports  . 193 

New  England’s  Adverse  Per  Diems . 195 

Rate  Divisions,  Based  on  New  England’s  Operating 
Disabilities,  Work  toward  Same  Benefits  as  Would 

Consolidation  with  Strong  Roads . 195 

Trunk  Line  Consolidation  a  Last  Resort  . 197 

The  Question  of  Competition . 197 

Transportation  Act  Does  not  Make  Consolidation  Com¬ 
pulsory  . 199 

Interstate  Commerce  Commission’s  “System  No.  7  — 

New  England”  Best  for  New  England . 199 

The  Proposed  New  England  System  Compared  -with 

Other  Railroad  Systems . 201 

New  England  Would  be  Submerged  in  Enlarged  Penn¬ 
sylvania  and  New  York  Central  Systems . 204 

Conclusion  of  Committee  as  to  Consolidation  ....  207 

Rehabilitation  by  Cooperation  —  New  Haven  ....  208 

Estimate  of  Earnings  in  1925  under  Normal  Conditions  211 

Basis  of  Estimate . 213 

Improved  Operation  Will  Build  up  Traffic . 216 

Cooperation  of  Employees . 217 

Credit . 218 

Readjustment  of  New  Haven  Capitalization . 220 

Atchison  Reorganization  of  1893  222 

Cooperation  of  the  States . 224 

Cooperation  of  Federal  Government . 228 

Early  Maturities  of  New  Haven  Debt . 228 


CONTENTS 


Vll 


Page 

Other  Suggestions . 230 

State  Cooperation  Not  New  in  New  England  Railroad 

History . 231 

Large  Public  Expenditures  for  Highways . 233 

Extensive  Use  of  Public  Credit  for  Municipal  Improve¬ 
ments  . 234 

Rehabilitation  of  Boston  &  Maine .  235 

Estimate  of  Earnings  in  1925  under  Normal  Condi¬ 
tions  . . . 236 

Basis  of  Estimate . 238 

Early  Maturities  of  Boston  &  Maine  Debt . 241 

Cooperation  of  the  States . 242 

No  Readjustment  in  Capitalization  Required  ....  243 

Cooperation  of  Federal  Government . 246 

Cooperation  of  Shippers . 246 

Devotion  and  Courage  of  Executives  of  New  England 

Roads  . .  .  247 

Conclusions . 248 

General  Findings . 248 

Specific  Findings . 250 

Consolidation . 251 

Rehabilitation  by  Cooperation  . 252 

Rehabilitation  of  the  New  Haven . 253 

Rehabilitation  of  the  Boston  &  Maine  . 255 

Final . 256 

Reservation  of  New  Hampshire  Committee . 258 

Statement  of  Maine  Committee . 259 

Statement  of  Philip  Dexter . 260 


LIST  OF  APPENDICES 


Page 


A.  Net  Capital  Expenditures  for  Road  and  Equipment 
All  New  England  Railroads,  July  1,  1914,  to  De¬ 
cember  31,  1922  .  263 

B  1,  2,  3.  Interchange  of  New  England  Railroads  with 

Connections  (year  ending  June  30,  1922) .  265 

C.  Description  of  Freight  Traffic  of  New  England 

Railroads . 271 

D.  Comparative  Rates  to  Pacific  Coast . 282 

E.  Arrivals  of  Foreign  and  Domestic  Vessels  at  Port  of 

Boston  April  1-15,  1923  283 

F.  New  England  Coal  Receipts  1916-1922  289 

G.  Increase  in  Per  Diem  Rates  1902-1922  .  290 

H.  Revenue  Ton  Miles  and  Passenger  Miles  1903-1922 

New  Haven  Railroad  (chart) . 293 

I.  Volume  of  Freight  and  Passenger  Traffic,  Revenues 

and  Rates  New  Haven  Railroad  1912-1922  .  .  .  295 


J.  Revenue  Ton  Miles  and  Passenger  Miles  1903-1922 

Boston  &  Maine  Railroad  (chart) . 297 

K.  Volume  of  Freight  and  Passenger  Traffic,  Revenues 

and  Rates  Boston  &  Maine  Railroad  1912-1922  .  299 

L.  Revenue  Ton  Miles  and  Passenger  Miles  1903-1922 

Boston  &  Albany  Railroad  (chart) . 301 

M.  Revenue  Ton  Miles  and  Passenger  Miles  1903-1922 

Maine  Central  Railroad  (chart) . 302 

N.  Revenue  Ton  Miles  and  Passenger  Miles  1903-1922 

Bangor  &  Aroostook  Railroad  (chart) . 303 

O.  Revenue  Ton  Miles  and  Passenger  Miles  1903-1922 

Central  Vermont  Railway  (chart) . 304 


APPENDICES 


Page 

P.  Revenue  Ton  Miles  and  Passenger  Miles  1903-1922 

Atlantic  &  St.  Lawrence  Railroad  (chart)  ....  305 

Q.  Revenue  Ton  Miles  and  Passenger  Miles  1903-1922 

Rutland  Railroad  (chart) . 306 

R.  Expenditures  of  Commonwealth  of  Massachusetts  on 

Port  of  Boston  1859-1922  307 

S.  Extract  from  Statement  of  William  S.  Jenney,  Coun¬ 

sel  for  Delaware,  Lackawanna  &  Western  Railroad, 
before  Interstate  Commerce  Commission  May  19, 

1923  .  309 

T.  New  York,  New  Llaven  &  Hartford  Railroad  Com¬ 

pany  Tentative  Plan  of  Readjustment  of  Capital¬ 
ization  . 317 

U.  Boston  &  Maine  Railroad  Tentative  Plan  for 

Extension  of  Debt . 329 

/ 


\ 


LIST  OF  MAPS 


Map 

1.  General  Map  of  New  England  Railroads. 

2.  Fifty  Mile  Zone. 

3.  Pacific  Coast  Differential  Area  Served  by  Panama 

Canal  Steamship  Lines. 

4.  Atlantic  Coast  Differential  Area  Served  by  Coastwise 

Steamship  Lines. 

5.  Relief  Map  of  New  England. 

6.  Main  Railroad  Routes  in  New  England. 

7.  New  Haven  Railroad. 

8.  Boston  &  Maine  Railroad. 

9.  Boston  &  Albany  Railroad. 

10.  Maine  Central  Railroad. 

11.  Bangor  &  Aroostook  Railroad. 

12.  Central  Vermont  Railroad,  Atlantic  &  St.  Lawrence 

Railroad. 

13.  Rutland  Railroad. 

14.  Export  Grain  Routes. 

15.  Transatlantic  Steamship  Routes. 

16.  Map  of  Boston  Waterfront  and  Railroad  Terminals 

with  Proposed  Plan  for  Development. 

17.  Cross  Section  of  Cowie  Plan  for  Development  of  Boston 

Waterfront. 

18.  Baltimore  &  Ohio  Railroad. 

19.  Bituminous  Coal  Movement. 

20.  Anthracite  Coal  Movement. 

21.  Pennsylvania  Railroad. 

22.  New  York  Central  Railroad. 

23.  Canadian  Differential  Routes. 


REPORT  OF  JOINT  NEW  ENGLAND  RAIL¬ 
ROAD  COMMITTEE  TO  THE  GOVERNORS 
OF  THE  NEW  ENGLAND  STATES 


REHABILITATION  BY  COOPERATION 
A  RAILROAD  POLICY  FOR  NEW  ENGLAND 


Appointment  of  Committee 

A  conference  of  the  Governors  of  the  six  New  Eng¬ 
land  States  was  held  in  June,  1922,  at  the  State  House, 
Boston,  pursuant  to  an  invitation  from  the  Governor 
of  Massachusetts,  to  consider  what  should  be  the  atti¬ 
tude  of  New  England  in  relation  to  section  five  of  the 
Transportation  Act  of  1920  (Esch-Cummins  Act) 
which  directed  the  Interstate  Commerce  Commission  to 
“  prepare  and  adopt  a  plan  for  the  consolidation  of  the 
railroad  properties  of  the  continental  United  States 
into  a  limited  number  of  systems.” 

At  this  conference  it  was  agreed  that  the  Governors 
should  each  appoint  a  committee  of  five  composed  of 
citizens  of  their  respective  States,  and  that  as  the  prob¬ 
lem  was  evidently  one  of  common  interest  the  com¬ 
mittees  should  work  in  harmony. 

August  15,  1922,  upon  the  call  of  Governor  Cox  the 
thirty  members  of  these  six  committees  met  in  the 
Council  Chamber  of  the  State  House  and  created  an 
Executive  Committee  composed  of  the  six  chairmen  of 


2 


the  State  Committees  with  the  Massachusetts  chairman 
as  Chairman  of  the  Executive  Committee. 

It  was  also  agreed  that  each  State  Committee  should 
proceed  to  hold  public  hearings  in  its  own  State. 

It  was  further  agreed  that  a  sound  conclusion  as  to 
what  form  of  consolidation  would  be  best  for  the  future 
welfare  of  New  England  could  he  reached  only  as  the 
result  of  an  intensive  study  of  the  whole  transportation 
problem  of  New  England  and  that  this  should  include 
sea  transportation,  rail  transportation,  sea  and  rail 
routes,  rail  and  inland  water  routes,  truck  transporta¬ 
tion,  differential  routes  and  rates,  interchange  of  traf¬ 
fic  between  New  England  and  other  States  and  inter¬ 
change  of  traffic  within  New  England.  It  was  decided 
that  the  Committee  should  also  study  the  present  physi¬ 
cal  condition  of  our  New  England  railroads,  the  addi¬ 
tional  facilities  and  equipment  required,  including  the 
financial  condition  and  needs  of  our  New  England  rail¬ 
roads,  and  finally  a  painstaking  examination  into  the 
effectiveness  of  the  present  management  of  our  New 
England  railroads. 

It  was  agreed  that  when  it  came  to  the  examination 
and  testimony  of  the  railroad  officials  the  members 
should  sit  as  one  joint  committee. 

It  was  also  the  opinion  of  the  Committee  that  as 
trained  expert  assistance  would  be  needed  in  the  study 
of  many  of  the  intricate  technical  problems  involved, 
the  joint  committee  should  establish  an  expert  staff. 

Advisory  Technical  Staff 

Howard  G.  Kelley  was  selected  by  the  Committee  to 
be  the  head  of  this  technical  staff.  Mr.  Kelley  has  had 


i 


3 


long  experience  on  numerous  roads  in  different  sections 
of  this  country,  first  as  an  engineer  and  then  on  the 
operating  side  and  finally  as  operating  vice-president 
of  the  Grand  Trunk  Railway  System,  and  then  for 
more  than  five  years  as  President  of  the  Grand  Trunk 
Railway  and  of  the  Grand  Trunk  Pacific  including  the 
steamship  lines.  The  members  of  the  Committee  be¬ 
lieve  they  were  fortunate  in  the  selection  of  Mr.  Kelley 
and  fortunate  in  the  chance  that  his  resignation  as  Presi¬ 
dent  of  the  Grand  Trunk  because  the  Canadian  Govern¬ 
ment  was  assuming  its  ownership  and  operation,  hap¬ 
pened  to  coincide  with  the  Committee’s  need  of  expert 
advice.  Mr.  Kelley  selected  as  his  principal  assistants 
J.  L.  White  as  operating  statistician,  C.  H.  Gerber  as 
engineer,  C.  E.  Lee  as  car  service  expert,  M.  J.  Wise  as 
inventory  and  stores  expert,  A.  B.  Fletcher  as  motor 
truck  expert,  and  from  time  to  time  such  other  tem¬ 
porary  expert  assistants  as  the  progress  of  the  work 
required.  The  Committee  has  also  received  invaluable 
aid  from  Frank  C.  Wright,  late  “  Assistant  Director  of 
Operations  ”  of  the  U.  S.  Railroad  Administration,  and 
equipped  by  long  experience  to  aid  the  Committee. 

Procedure  Followed  by  Committee 

The  public  hearings  in  the  several  states  were  con¬ 
cluded  in  October.  A  joint  public  hearing  in  the  State 
House,  Boston,  was  then  held,  lasting  three  days,  open 
to  all  and  closed  when  it  appeared  that  all  wishing  to 
be  heard  had  been  given  the  opportunity. 

On  November  23,  the  Committee  sitting  as  a  whole 
began  its  first  across-the-table  question-and-answer  dis¬ 
cussion  with  the  officers  of  the  Bangor  &  Aroostook 


4 


Railroad,  first  the  President,  and  then  with  his  hearty 
co-operation  the  General  Manager,  the  Mechanical 
Superintendent,  the  Purchasing  Agent,  the  General 
Freight  Agent,  Superintendent  of  Car  Service,  En¬ 
gineer  of  Maintenance,  Division  Superintendents 
and  Train  Masters.  This  first  examination  involved 
four  days  and  occupied  448  pages  of  the  Com¬ 
mittee’s  record.  The  questions  were  largely  asked  by 
members  of  the  technical  staff,  but  many  questions 
were  asked  daily  by  members  of  the  Committee. 

In  like  manner  the  effort  to  collect  the  material  facts 
proceeded  in  regard  to  the  other  New  England  rail¬ 
roads.  In  the  case  of  the  New  Haven  Railroad,  our 
largest  system,  the  examination  of  fourteen  officers  oc¬ 
cupied  19  days  and  extends  to  2601  pages  of  the  Com¬ 
mittee’s  record  and  involved  the  production  of  scores 
of  charts  and  tables  of  facts  and  figures  relating  to  the 
operation  of  the  property. 

All  together  one  hundred  and  fifty  individuals  ap¬ 
peared  before  the  Committee  at  its  various  hearings. 
The  Record  of  the  Committee  comprises  6387  pages. 

Members  of  our  expert  staff  also  have  been  con¬ 
stantly  gathering  further  information  by  contact  with 
the  statistical  and  operating  departments  of  the  several 
roads  and  from  the  comprehensive  records  of  the  Inter¬ 
state  Commerce  Commission  at  Washington  and  the 
files  of  the  different  New  England  state  commissions. 

The  response  of  the  presidents  and  their  respective 
staffs  to  the  almost  innumerable  and  often  burdensome 
requests  of  this  Committee  for  information  or  statistics 
on  this  or  that  topic  of  study  has  been  painstaking  and 
-cordial. 


5 


Members  of  the  Committee  and  the  Committee’s  staff 
at  the  invitation  of  the  President  of  the  New  Haven 
Railroad  and  the  President  of  the  Boston  &  Maine  Rail¬ 
road  made  a  three  days’  trip  over  the  main  lines  of 
traffic  of  each  of  these  systems  visiting  the  more  im¬ 
portant  terminals,  classification  yards,  car  and  locomo¬ 
tive  shops  and  other  important  points,  and  Mr.  Kelley 
and  his  staff  from  time  to  time  have  examined  various 
portions  of  the  properties  as  their  studies  made  it  de¬ 
sirable. 


6 


THE  NEW  ENGLAND  RAILROADS  AS  A 

GROUP 


General  Description 


The  New  England  railroads*  comprise  8,135  miles 
of  line.  (Map  1.) 

The  total  capitalization  is  $976,048,743,  represented 
by  $619,657,734  bonds  and  $356,391,009  capital  stock. 

The  gross  earnings  for  the  calendar  year  1922  were 
$288,961,226  exceeded  in  this  country  only  by  the  earn¬ 
ings  of  the  Pennsylvania  system  and  the  New  York 
Central  system. 

The  number  of  railroad  employees  is  approximately 
83,000. 

The  number  of  locomotives  is  3,392;  passenger  cars 
5,410  and  freight  cars  80,604. 

The  New  England  Railroads  have  made  net  capital 
expenditures  of  $110,282,000  in  the  past  eight  years  for 
the  improvement  of  their  facilities  and  for  new  equip¬ 
ment.  Of  this  total  $42,809,000  has  been  for  new  equip¬ 
ment,  $16,549,000  for  locomotives  alone,  t 

The  total  passengers  carried  in  1922  was  153,213,177, 


*  Lnless  otherwise  noted  statistics  of  New  England  railroads  as  a 


group  include  the  following: 
Bangor  &  Aroostook  Railroad 
Atlantic  &  St.  Lawrence  Railroad 
(Grand  Trunk  Line  in  Maine) 
Alaine  Central  Railroad 
Central  Vermont  Railway 
Rutland  Railroad 


Boston  &  Alaine  Railroad 
Boston  &  Albany  Railroad 
New  York,  New  Haven  &  Hartford 
Railroad 

Central  New  England  Railroad 


t  Appendix  A.  Net  Capital  Expenditures  for  Road  and  Equipment.  All 
New  England  Railroads,  July  1  1914,  to  December  31,  1922. 


7 


which  translated  into  “  passenger  miles  ”  is  equivalent 
to  3,336,832,000  passengers  carried  one  mile.  The  aver¬ 
age  length  of  ride  per  passenger  per  road  in  New  Eng¬ 
land  is  21.8  miles  as  compared  with  36.7  miles  for  the 
United  States. 

The  total  revenue  tons  moved  in  1922  was  78,845,630, 
and  this  translated  into  revenue  tons  carried  one  mile 
shows  that  our  New  England  railroads  in  that  year 
manufactured  8,814,777,000  freight  ton  miles.  The 
average  haul  per  ton  of  freight  per  road  is  111.8  miles 
in  New  England  as  compared  with  186.5  miles  for  the 
United  States. 

Ton  Miles  and  Passenger  Miles 

The  volume  of  freight  and  passenger  traffic  as  ex¬ 
pressed  in  terms  of  revenue  ton  miles  and  passenger 
miles  borne  on  the  New  England  railroads  during  the 
last  twenty  years  has  been  as  follows : 


Revenue 

Passenger 

Year 

Ton  Miles 

Miles 

1903  . 

.  4,982,302,000  . . . . 

. . . .  2,280,968,000 

1904  . 

.  4,991,302,000  .... 

. . . .  2,303,185,000 

1905  . 

.  5,361,765,000  . . . . 

....  2,376,606,000 

1906  . 

.  5,888,051,000  . . . . 

....  2,522,950,000 

1907  . 

.  6,449,631,000  . . . . 

. . . .  2,693,965,000 

1908  . .  . 

.  6,034,634,000  . . . . 

....  2,740,626,000 

1909  . 

.  6,224,045,000  . . . . 

. . . .  2,741,803,000 

1910 . 

.  7,007,292,000  . . . . 

. . . .  2,969,774,000 

1911 . 

.  7,125,827,000  . . . . 

. . . .  3,009,275,000 

1912 . 

.  7,574,114,000  .... 

. . . .  3,090,156,000 

1913 . 

.  8,286,967,000  .... 

. . . .  3,188,580,000 

1914  . . . 

.  8,095,901,000  .... 

. . . .  3,183,184,000 

1915 . 

.  7,660,425,000  .... 

. . . .  2,937,379,000 

1916 . 

.  9,141,727,000  .... 

. . . .  2,990,400,000 

8 


Revenue  Ton  Miles  and  Passenger  Miles 
New  England  Railroads,* 


1903  to  1922  Inclusive 


H 

M 

s 

11000 

10500 

10000 

9500 

9000 

8500 

8000 

7500 

7000 

6500 

6000 

5500 

5000 

4500 

4000 

3500 

3000 

2500 

2000 

1500 

1000 

500 


*  Statistics  are  for  years  ending  June  30,  1903  to  1916,  inclusive, 
and  for  years  ending  December  31,  1917  to  1922,  inclusive.  They  exclude 
in  all  years  figures  for  the  following  small  lines  in  the  Boston  &  Maine 
system  for  which  complete  statistics  were  not  available  prior  to  1912 : 
Vermont  Valley  Mount  Washington 

Sullivan  County  Montpelier  and  Wells  River 

St.  Johnsbury  &  Lake  Champlain  Barre  and  Chelsea 

York  Harbor  and  Beach 


This  accounts  for  the  slight  difference  in  the  statistics  for  1922  in  this 
table  and  those  for  1922  on  other  pages  of  this  report  in  which  these 
small  lines  are  included. 


9 

Year 

Revenue 

Passenger 

Ton  Miles 

Miles 

1917 . 

.  10,084,859,000  . . . . 

. . . .  3,431,432,000 

1918 . 

.  10,850,628,000  . . . . 

. . . .  3,364,325,000 

1919 . 

.  10,202,336,000  . . . . 

. . .  .  3,732,770,000 

1920  ....... 

.  10,691,283,000  . . .  . 

. . . .  3,970,913,000 

1921 . 

.  8,380,871,000  . . .  . 

. . . .  3,408,035,000 

1922  . 

.  8,702,754,000  .  . .  . 

. . . .  3,320,170,000 

Ton  Miles  Passenger  Miles 

New  England  United  States  New  England  United  States 

Percent  of  increase 

1903  to  1912....  52.02  50.09  35.48  54.51 

Percent  of  increase 

1912  to  1922....  14.90  30.67  7.44  9.87 

It  will  be  seen  that  for  tbe  whole  period  of  twenty 
years  freight  ton  miles  have  grown  faster  than  passen¬ 
ger  miles  and  also  that  during  the  second  decade  the  per¬ 
centage  of  growth  in  freight  ton  miles  has  fallen  much 
below  the  rate  of  increase  for  the  country  as  a  whole. 

We  comment  on  this  because  all  our  studies  indicate 
that  if  New  England  wishes  to  avoid  the  risk  of  coming 
to  a  standstill  it  is  time  to  take  some  constructive  action 
to  give  our  industrial  development  a  fresh  impetus. 

Interchange  with  Connecting  Lines 

The  total  number  of  freight  cars  moving  into  and 
out  of  New  England  to  and  from  its  rail  connections, 
beyond  the  Hudson  River  and  also  through  the  north¬ 
ern  rail  gateways,  amounted  in  the  year  ending  June 
30,  1922,  to  1,209,005  cars  inbound  and  1,209,244  out¬ 
bound,  including  both  loads  and  empties.  1,097,391 
loaded  cars  were  received  from  and  443,347  loaded  cars 
were  delivered  to  their  connections  by  the  New  Eng- 


land  lines.*  This  is  an  unbalanced  movement.  Five 
loaded  cars  come  into  New  England  for  every  two  that 
go  out,  chiefly  owing  to  the  one  way  movement  of  coal, 
food  and  raw  materials.  Kecord  of  the  tons  of  merchan¬ 
dise  involved  in  this  car  movement  is  not  kept  but  if 
we  take  the  average  car  loading  figure  of  each  railroad 
we  get  a  total  freight  movement  in  and  out  of  New  Eng¬ 
land  for  the  year  1922  of  31,500,000  tons  as  an  approxi¬ 
mate  estimate. 


Character  of  Traffic 

The  traffic  of  the  New  England  railroads  as  a  group 
is  characterized  by  a  relatively  high  percentage  of  pass¬ 
enger  business,  including  a  heavy  low  fare  suburban 
passenger  business  especially  in  the  case  of  the  New 
Haven,  Boston  &  Maine  and  Boston  &  Albany  railroads. 
The  New  England  railroads  originate  little  low  grade 
bulk  tonnage  such  as  grain,  coal,  ore  and  the  prod¬ 
ucts  of  furnaces,  steel  mills  and  other  heavy  indus¬ 
tries.  t  There  is  a  high  percentage  of  less  than  car  load 
shipments.  The  rate  on  these  small  shipments  is  high, 
but  they  require  rehandling  by  the  railroad  at  transfer 
points  to  consolidate  into  cars  according  to  destination 
and  the  average  car  load  is  light  so  that  this  traffic  pro¬ 
duces  for  the  originating  road  little  net  money. 

*  Appendix  B.  Interchange  of  New  England  Railroads  with  Connec¬ 
tions  (year  ending  June  30,  1922). 


t Appendix  C.  Description  of  Traffic  of  New  England  Railroads. 


11 


IMPORTANCE  OF  NEW  ENGLAND’S  WATER 

TRANSPORTATION 

Before  proceeding  further  with  our  railroad  study 
it  will  be  well  to  get  before  us  the  picture  of  New 
England’s  water  transportation,  its  characteristics,  the 
volume  of  traffic  and  the  more  important  trade  routes. 

No  other  section  of  our  coast  line  either  on  the  At¬ 
lantic,  the  Gulf  of  Mexico  or  the  Pacific  contains  an 
equal  number  of  bays  and  arms  of  the  sea  affording 
such  safe  and  easy  access  to  deep  water. 

New  England  has  always  kept  its  face  seaward  even 
when  under  the  new  era  of  railroads  it  seemed  to  be 
permitting  the  ocean  to  play  a  less  important  part  in 
its  industrial  development.  More  than  seventy  per 
cent  of  the  New  England  population  still  live  and  the 
major  part  of  our  industrial  activity  is  carried  on  with¬ 
in  fifty  miles  of  the  seaboard.  Within  this  fifty  mile 
zone  lives  97  per  cent  of  the  population  of  Connecticut, 
all  of  Rhode  Island,  61  per  cent  of  the  people  of  Massa¬ 
chusetts,  57  per  cent  of  New  Hampshire  and  77  per 
cent  of  Maine.  (Map  2.) 

On  the  water  New  England  has  a  great  four-track 
railway,  or,  if  you  please,  ten  tracks  with  all  the  desired 
sidings,  ready  for  use  without  the  outlay  of  a  dollar  for 
construction  or  for  upkeep  or  to  guard  the  right  of  way. 

The  practical  doubling  of  the  cost  of  rail  transporta¬ 
tion  since  1913  due  to  the  rise  in  wages  and  materials 
has  given  a  new  and  much  accentuated  value  to  water 
transportation.  New  England  is  well  situated  to  profit 
by  this  new  condition. 


It  is  true  that  soon  after  the  opening  of  the  great 
war  the  fabulous  prices  paid  for  steamers  to  go  over¬ 
seas  disorganized  our  coastwise  traffic.  Then  it  took 
time  to  get  the  steamers  back  and  restore  the  service,  so 
that  it  is  only  within  the  last  year  or  two  that  we  are 
beginning  to  realize  what  the  new  balance  between 
water  and  rail  transportation  means  to  New  England. 

Pacific  Coast  Lines 

The  new  Panama  Canal,  likewise  disturbed  hv  war 
conditions,  is  to-day  functioning  with  a  rapidly  in¬ 
creasing  number  of  vessels  month  by  month.  There  are 
now  five  steamship  lines  giving  regular  sailings  from 
Boston  to  Pacific  Coast  ports  through  the  Canal.  One 
of  these  lines  also  gives  service  from  Portland  and 
another  from  Providence.  New  England  has  been 
brought  nearer  to  the  great  and  prosperous  population 
of  the  Pacific  Coast  than  the  cities  of  Detroit,  Pitts¬ 
burgh,  Cleveland  or  Chicago. 

For  example,  the  rate  on  shoes  by  Panama  route 
from  Boston  to  San  Francisco  is  $1.50  per  hundred 
pounds,  while  from  Chicago  by  rail  it  is  more  than 
twice  as  much  —  $3.69  per  hundred  in  car  load  lots  and 
$4.41  in  less  than  car  load  lots.  From  Detroit  the  rail 
rate  to  San  Francisco  is  $3.76  (less  than  car  load  $4.74)  ; 
from  Pittsburgh  $4.65  (less  than  car  load  $4.74).  Cot¬ 
ton  piece  goods  from  Boston  by  water  60  cents  per  hun¬ 
dred,  from  Chicago  by  rail  $1.58  (less  than  car  load 
$2.95%).  Pianos  from  Boston  75  cents,  from  Chicago 
$2.50  (less  than  car  load  $5.10).  Automobile  tires  from 
Boston  80  cents,  from  Chicago  $2.50  (less  than  car  load 
$4.82).*  (Map  3.) 

*  Appendix  D.  Comparative  Rates  to  Pacific  Coast . 


13 


Coastwise  Steamship  Lines 

Nightly  steamers  ply  from  Portland,  Boston,  New 
Bedford,  Fall  River,  Providence,  New  London,  Nor¬ 
wich,  Hartford,  New  Haven  and  Bridgeport  to  New 
York  delivering  New  England  merchandise  at  that 
great  center  of  distribution  intended  either  for  local 
consumption  or  for  further  carriage  by  the  many  rail 
routes  and  water  routes  radiating  from  New  York. 

The  steamers  of  the  Merchants  &  Miners  Transporta¬ 
tion  Company  give  excellent  service  from  Boston  and 
Providence  to  Philadelphia,  Baltimore  and  Norfolk. 
The  Clyde  Steamship  Company  steamers  maintain  bi¬ 
weekly  service  to  Charleston  and  Jacksonville.  The 
Ocean  Steamship  Company  has  four  first-class  steam¬ 
ers  which  give  sailings  twice  a  week  to  Savannah.  An 
all-water  route  to  the  principal  Gulf  ports  is  afforded 
by  boat  to  New  York  and  thence  by  the  Mallory  or  the 
Southern  Pacific  steamers  to  the  Gulf.  The  intensive 
manufacturing  region  of  western  Connecticut,  include 
ing  Hartford,  New  Haven,  Bridgeport,  Waterbury, 
Meriden  and  Ansonia,  naturally  ship  from  the  port  of 
New  York  which  to  the  great  advantage  of  southwest¬ 
ern  New  England  flanks  our  western  boundary.  Maine 
and  the  Canadian  Maritime  Provinces  link  in  to  this 
system  of  coastwise  transportation  by  steamers  run¬ 
ning  to  Boston  and  direct  sailings  from  Portland  to 
New  York. 

These  southern  coastwise  steamer  routes,  running 
parallel  to  the  coastline,  take  our  merchandise  around 
the  badly  car  congested  rail  centers  of  New  York  and 
Philadelphia  and  they  not  only  make  quicker  and  more 


14 


dependable  despatch  but  at  substantially  lower  rates. 
They  also  afford  combined  differential  water  and  rail 
routes  to  many  important  points  in  the  Southeast,  Mid¬ 
dle  West  and  Southwest  to  which  they  supply  quick 
and  regular  service.  (Map  4.) 

The  Ocean  Steamship  Company,  for  instance,  con¬ 
trolled  by  the  Illinois  Central  Railroad  through  its 
ownership  of  the  Central  Railway  of  Georgia,  makes 
direct  connection  with  the  rails  of  that  great  system  at 
Savannah  so  that  in  effect  we  have  an  Illinois  Central 
eastern  terminal  at  Boston  offering  New  England  the 
advantage  of  rates  lower  than  standard,  and  fast  service 
to  many  points  in  the  interior  states  reached  by  that 
system. 

The  Merchants  &  Miners  line  also  offers  differential 
routes  which  connect  with  fast  freights  leaving  Balti¬ 
more  and  Norfolk  on  the  afternoon  of  the  arrival  of 
the  steamers,  via  the  Norfolk  &  Western  from  Norfolk, 
and  via  the  Baltimore  &  Ohio  from  Baltimore- 

We  think  our  merchants  and  manufacturers  have 
not  yet  fully  taken  advantage  of  the  recently  enhanced 
importance  of  our  water  and  water-rail  routes  and  per¬ 
haps  the  products  of  our  industries  need  some  readjust¬ 
ment  to  better  suit  these  new  markets.  The  New  Eng¬ 
land  manufacturer  should  revise  his  map ;  the  Pacific 
Coast  within  the  last  thirtv-six  months  has  been  moved 
a  thousand  miles  nearer  to  his  factory  door. 

Foreign  Commerce 

It  is  not  necessary  now  to  dwell  on  the  steamers  serv¬ 
ing  New  England  mostly  through  the  port  of  Boston 
which  arrive  from  all  parts  of  the  world  bringing  hides 


15 


and  skins,  wool,  cotton,  wood  pulp,  sugar,  hemp,  coffee 
and  many  other  supplies  and  raw  materials  for  our 
people  and  our  industries.  It  is  true  that  the  port  of 
Boston  because  of  certain  limitations  has  not  been  par¬ 
ticularly  successful  in  recent  years  in  serving  as  a  gate¬ 
way  for  other  states  to  the  west  of  New  England  but  no 
mistake  should  be  made  in  regard  to  the  service  rend¬ 
ered  to  the  people  of  New  England.  We  give  as  a  pic¬ 
ture  of  this  service  (Appendix  E)  the  steamer  arrivals 
coastwise  and  foreign  for  the  first  fifteen  days  of  April. 
It  is  worth  examining. 

Volume  of  Waterborne  Traffic 

The  total  tonnage  moving  in  and  out  of  our  New  Eng¬ 
land  water  gateways  for  the  year  1921  amounted  to 
26,158,573  tons  compared  with  31,500,000  tons  of  all-rail 
freight  moving  through  our  rail  gateways  for  the  year 
ending  June  30,  1922. 

This  waterborne  tonnage  was  divided  as  follows : 


Port  Total  Tons 

Northern  Maine — Searsport,  Bangor,  Bockland 

and  smaller  ports .  659,501 

Southern  Maine — Portland  and  smaller  ports . .  2,522,556 

New  Hampshire — Portsmouth  .  98,754 

Boston  and  Northern  Massachusetts  ports....  10,602,919 
Southern  Massachusetts — Fall  Biver,  New  Bed¬ 
ford  and  smaller  ports  .  4,065,083 

Rhode  Island — Providence,  Newport,  Paw¬ 
tucket,  Bristol .  4,432,232 

Connecticut — New  London,  New  Haven,  Bridge¬ 
port,  Hartford  and  smaller  ports  .  3,777,528 

Total — New  England  .  26,158,573 

This  tonnage  includes  coal*  and  oil  as  well  as  import 


and  export  traffic  and  all  other  water  borne  cargoes. 

•Appendix  F.  New  England  Coal  Receipts,  1916-1922. 


16 


Coastwise  Merchandise  Movement 

For  the  first  four  months  of  the  calendar  year  1923 
the  coastwise  steamship  movement  of  merchandise 
moving  through  our  New  England  ports  by  regular 
coastwise  steamship  lines  shows  an  increase  of  59.5 
per  cent  as  compared  with  the  same  period  of  last  year. 

The  tonnage  carried  in  the  intercoastal  service  via 
the  Panama  Canal  was  77  per  cent  greater  for  the  first 
four  months  of  1923. 


17 


TOPOGRAPHY  OF  NEW  ENGLAND 
RAILROADS 

We  turn  back  now  to  our  New  England  railroad 
transportation. 

It  is  well  to  have  the  general  topography  of  our  New 
England  railroads  in  mind.  (Map  5.) 

The  main  east  and  west  line  of  the  New  Haven  leaves 
Boston,  and  by  easy  grades  cuts  across  to  Narragan- 
sett  Bay  at  Providence,  whence  it  proceeds  by  water 
level  route  along  the  south  shore  to  the  Harlem  River 
and  New  York  City.  Eight  miles  west  of  New  Haven  a 
double-track  road  branches  off  the  main  line  in  a  north¬ 
westerly  direction  and  passing  through  Danbury  crosses 
the  Hudson  on  the  Poughkeepsie  bridge  and  reaches  the 
western  terminal  of  this  line  at  Maybrook.  It  is  an  im¬ 
portant  freight  route. 

The  next  east  and  west  line  is  the  old  New  York  and 
New  England  which  starting  at  Boston  passes  through 
Willimantic,  Hartford  and  Waterbury  to  the  Pough¬ 
keepsie  bridge  across  the  Hudson.  It  has  heavy  grades 
and  at  present  is  comparatively  little  used  for  either 
passenger  service  or  freight. 

The  main  line  of  the  Boston  &  Albany  passes  through 
Worcester,  Springfield  and  Pittsfield  to  a  connection 
with  the  New  York  Central  on  the  east  bank  of  the 
Hudson  at  Rensselaer..  It  crosses  two  main  divides 
with  heavy  grades,  reaching  the  top  of  the  first  at  960 
feet  between  Worcester  and  Springfield,  then  down  to 
practically  tidewater  again  at  Springfield.  From  here 
the  road  rises  until  it  crosses  the  main  chain  of  the 


18 


Berkshires  at  an  elevation  of  1,410  feet,  tlience  clown  to 
the  Pittsfield  meadows  and  so  on  to  the  Hudson  River 
by  reasonable  grades. 

The  main  line  of  the  old  Fitchburg  Railroad  consti¬ 
tutes  the  fourth  line  across  New  England  and  encoun¬ 
ters  the  same  divides  as  the  Boston  &  Albany,  but  its 
two  maximum  altitudes  of  1220  feet  at  South  Asliburn- 
ham  and  830  feet  at  the  Hoosac  Tunnel  are  substantially 
lower  and  the  line  is  13  miles  shorter.  It  reaches  its 
western  terminus  at  Rotterdam  Junction  where  it  con¬ 
nects  with  the  main  line  of  the  New  York  Central  and 
of  the  West  Shore. 

The  two  northern  gateways  at  White  River  Junction, 
Vermont,  and  Newport,  Vermont,  where  the  Boston 
&  Maine  connects  with  the  Grand  Trunk  and  the  Cana¬ 
dian  Pacific,  respectively,  will  be  referred  to  more 
specifically  later. 

The  balance  of  the  New  England  railroad  mileage, 
except  for  the  Boston  &  Maine  lines  paralleling  the 
shore  to  Portland,  chiefly  follows  the  north  and  south 
valleys  affording  easier  grades  and  representing  less 
original  cost  of  construction.  (Map  6.) 

Three  of  the  four  east  and  west  lines  just  mentioned 
were  assisted  by  state  aid  in  Massachusetts,  granted  be¬ 
cause  of  the  belief  that  New  York  was  getting  ahead  of 
Massachusetts  and  Northern  New  England  and  that 
unless  the  state  stepped  in  and  helped  to  build  these 
roads  New  England’s  industrial  future  was  in  danger. 


19 

Ton  Miles  and  Passenger  Miles 

We  give  the  rank  of  the  New  England  railroads  as 
to  passengers  and  freight,  based  upon  freight  ton 
miles  and  passenger  miles  (year  ending  December  31, 
1922) : 


Revenue  Ton  Miles 

Passenger  Miles 

New  Haven  *  . 

3,020,410,000 

1,857,933,000 

Boston  &  Maine . 

2,801,938,000 

863,856,000 

Boston  &  Albany . 

1,089,660,000 

376,178,000 

Maine  Central  . 

857,667,000 

128,431,000 

Central  Vermont . 

369,128,000 

33,148,000 

Bangor  &  Aroostook  . . . 

267,482,000 

20,580,000 

Atlantic  &  St.  Lawrence 

(Grand  Trunk)  . 

206,851,000 

13,133,000 

Rutland  . 

201,641,000 

43,573,000 

Total  . 

8,814,777,000 

3,336,832,000 

The  task  of  a  railroad  is  to  manufacture  freight  ton 
miles  and  passenger  miles.  If  a  railroad  hauls  a  car 
containing  30  tons  of  freight  20  miles  that  movement 
will  produce  600  ton  miles.  While  the  car  was  stand¬ 
ing  in  a  yard  before  it  began  to  move  the  railroad  was 
earning  nothing  from  this  car  or  its  contents.  It  might 
have  stood  there  a  year,  but  if  it  had  it  would  not  have 
contributed  a  cent  to  the  railroad.  After  the  car  has 
been  pulled  the  20  miles,  the  instant  it  stands  still  it 
again  stops  earning.  W e  all  realize  that  we  pay  the  rail¬ 
road  only  for  the  service  of  moving  our  freight  from  one 
place  to  another.  The  moment  our  freight  stands  still  we 
are  receiving  no  benefit,  and  the  railroad  earns  nothing. 

*  In  all  cases  statistics  for  the  New  Haven  Railroad  include  Central 
New  England  Railroad  unless  otherwise  stated. 


20 


Freight  Earnings  Depend  upon  Keeping 

Cars  Moving 

But  we  have  not  told  the  whole  story.  A  car  stand¬ 
ing  still  for  a  day  not  only  earns  absolutely  nothing  but 
it  is  worse  than  this.  Under  the  “  per  diem  ”  rule,  if 
the  car  belongs  to  another  railroad  $1  must  he  paid  each 
day  for  the  use  of  the  car  to  the  railroad  owning  the 
car.*  The  dollar  must  be  paid  whether  the  car  moves 
or  does  not  move  and  whether  empty  or  loaded ;  but  if 
the  car  is  loaded  and  moves  20  miles  it  will  have  earned 
something  out  of  which  to  pay  the  dollar,  but  if  this 
loaded  car  stands  still  for  24  hours  or  a  week  or  a 
month  it  not  only  has  earned  nothing  but  the  railroad 
on  the  tracks  of  which  the  car  stands  is  actually  out  of 
pocket  a  dollar  or  seven  dollars  or  thirty  dollars.  If  the 
car  stands  on  a  side  track  for  a  year  it  will  cost  the 
railroad  $365.  Furthermore,  it  makes  no  difference 
really  whether  this  car  belongs  to  some  other  road  or  to 
the  railroad  allowing  it  to  stand  idle  on  its  own  tracks. 
If  the  railroad  does  not  own  the  car  it  must  pay  one 
dollar  in  cash  to  the  owning  road,  but  if  it  does  own  the 
car,  interest  on  the  investment  plus  depreciation  and 
upkeep  amounts  to  practically  a  dollar  a  day — cer¬ 
tainly  over  90  cents.  So  that  any  railroad  holding  a 
car  idle  for  24  hours,  whether  or  not  the  car  is  owned 
by  the  railroad  holding  it,  earns  nothing  and  besides  is 
set  back  a  dollar.  Even  this  is  not  allowing  for  the  fact 
that  there  may  be  profitable  business  for  the  car  to  per¬ 
form,  which  is  being  lost  to  another  road  or  a  truck  or 
boat.  The  car  may  be  standing,  moreover,  in  an  ex¬ 
pensive  terminal,  representing  a  heavy  investment  of 

*  Appendix  G.  Increase  in  Per  Diem  Rates  1902-1922. 


21 

capital,  the  profitable  use  of  which  may  he  hindered  by 
too  many  idle  cars. 

It  follows  from  what  we  have  said  that  a  railroad 
earns  money  only  when  and  while  the  car  is  actually 
moving,  and,  moreover,  that  it  must  be  a  nimble  car  as 
the  car  per  diem  is  always  eating  up  the  net  earnings. 
If  the  car  moves  slowly  over  the  system  with  frequent 
pauses,  a  railroad  may  obtain  no  net  profit  or  any  bene¬ 
fit  whatever  for  hauling  the  car  from  one  end  of  its 
system  to  the  other.  The  per  diem  will  have  eaten  up 
the  net,  but  a  narrow  margin  at  best,  or  perhaps  eaten 
more  than  the  net. 


22 


NEW  HAVEN  RAILROAD 
Operation 

Proceeding  now  to  take  up  the  individual  roads,  we 
begin  with  the  New  Haven  as  it  is  the  largest  New  Eng¬ 
land  producer  of  ton  miles  and  passenger  miles.  (Map 

7.) 

Average  Daily  Movement  of  Freight  Cars 

From  what  w^e  have  said  it  is  clear  that  taking  ac¬ 
count  of  all  the  cars  on  the  system  the  average  distance 
moved  per  car  each  day  constitutes  a  significant  test  of 
the  efficiency  with  which  a  railroad  is  operated.  We 
give  the  figures  for  the  year  ending  June  30,  1922,  and 
in  a  parallel  column  the  average  percentage  of  bad 
order  cars  which  is  of  course  one  factor  that  should  be 
taken  into  account  in  making  this  comparison : 


Average  Car  Miles 

Per  Cent 

Per  Freight  Car  Day 

Bad 

(All  Cars) 

Order  Cars 

Boston  &  Albany . 

.  27.8 

7.2 

Atlantic  &  St.  Lawrence 

(Grand  Trunk  Line  to 

Portland)  21.8 

7.5 

Central  Vermont  . 

.  19.3 

34.8 

Maine  Central  . 

.  17.8 

15.6 

Rutland  . . 

.  17.7 

24.6 

Boston  &  Maine  . 

.  17.1 

19.4 

Bangor  &  Aroostook  . . . 

.  13.8 

25.2 

New  Haven  . 

.  13.6 

24.9 

The  average  for  all  the  railroads  in  the  Eastern  District 
of  the  United  States  for  the  same  period  was  19.8  car 
miles  per  freight  car  day. 


23 


It  will  be  noted  that  we  have  taken  a  period  when  our 
railroads  were  unaffected  by  the  shop  strike. 

It  is  true  that  the  New  Haven  had  a  larger  propor¬ 
tion  of  bad  order  cars  than  the  Boston  &  Maine,  and 
that  this  pulled  down  the  New  Haven’s  average  miles 
per  freight  car.  This  is  true  but  not  to  an  extent  that 
materially  changes  the  picture,  as  will  be  seen  from 
the  following  comparison  of  the  car  miles  per  freight 
car  day  of  the  various  New  England  roads  with  bad 
order  cars  eliminated  (year  ending  June  30,  1922)  : 


Boston  &  Albany .  30.0 

Central  Vermont  . .  29.5 

Rutland  . 23.6 

Atlantic  &  St.  Lawrence  ...... . .  23.3 

Boston  &  Maine  .  21.2 

Maine  Central  .  21.2 

Bangor  &  Aroostook .  19.3 

New  Haven . 18.1 


It  may  justly  be  urged  on  behalf  of  the  New  Haven 
that  with  its  many  branches  and  consequent  multi¬ 
plicity  of  junction  points  it  is  bound  to  show  a  less 
rapid  movement  than  the  Boston  &  Albany  with  its 
relatively  small  branch  line  mileage.  But  the  discrep¬ 
ancy  seems  greater  than  it  should  be.  The  Maine  Cen¬ 
tral  we  think  has  quite  as  large  a  proportion  of  branch 
lines,  and  yet  it  made  an  average  of  21.2  miles  per  day 
compared  with  the  New  Haven’s  18.1.  If  we  compare 
the  New  Haven  performance  with  that  of  the  Boston  & 
Maine,  which  encounters  quite  similar  difficulties, 
we  find  that  the  Boston  &  Maine  management  produced 
during  this  year  ending  June  30,  1922,  an  average  of 
21.2  car  miles  per  freight  car  day  per  serviceable  car 
to  the  New’’  Haven’s  18.1  car  miles. 


24 


The  average  daily  distance  of  21.2  miles  travelled  by 
a  freight  car  on  the  Boston  &  Maine  system  may  not 
seem  so  very  different  from  the  18.1  of  the  New  Haven 
Railroad,  but  let  a  manufacturer  instruct  his  engineer 
to  slow  down  his  machinery  15  per  cent  and  the  slower 
speed  will  put  his  profits  out  the  window  and  eventually 
get  him  into  financial  difficulties.  So  it  is  with  rail¬ 
roads —  the  slow-mover  is  generally  the  tail-ender. 

The  Cost  of  Slow  Movement  of  Freight  Cars 

If  the  New  Haven  by  more  efficient  operation  could 
have  speeded  up  the  average  car  movement  on  its  sys¬ 
tem  3.1  miles  a  day,  which  would  have  brought  it  up  to 
the  level  of  the  Boston  &  Maine,  it  would  have  reduced 
its  total  car  days  of  serviceable  cars  for  the  year  to  10,- 
072,783.  This  would  have  effected  a  saving  of  1,731,317 
car  days,  equal  to  a  saving  of  that  number  of  dollars, 
namely  1,731,317  dollars.  This  means  it  would  have 
pulled  the  same  cars  on  its  line  and  earned  the  same 
gross  money,  but  it  would  have  returned  the  foreign 
cars  17  per  cent  sooner  to  its  connections  and  therefore 
would  have  to  pay  out  for  car  hire  a  great  deal  less 
money,  and  its  own  cars  to  whatever  extent  they  were 
employed  would  have  either  travelled  that  much  sooner 
on  to  other  lines  so  that  the  other  lines  would  begin  pay¬ 
ing  the  New  Haven  a  dollar  a  day  for  their  use,  or  else, 
in  case  some  of  the  home  cars  remained  on  the  New 
Haven  system  all  the  time,  would  have  saved  a  lot  of 
car  days  so  that  these  cars  could  have  performed  addi¬ 
tional  service  for  which  the  New  Haven  would  have 
earned  more  money.  The  net  result  is  really  the  same 
in  all  three  cases.  A  freight  car  is  worth  a  dollar  a  day, 


25 


and  this  should  properly  be  charged  against  each  car  on 
any  given  system  whether  the  cars  belong  to  the  system 
or  are  borrowed  from  some  other  road.  Moreover,  it 
should  be  borne  in  mind  that  over  and  above  this  mere 
saving  in  car  days  and  in  consequence  the  $1,731,317 
car  per  diems  it  frees  the  road  for  just  so  much  more 
additional  earning  traffic.  Slowing  down  car  move¬ 
ment  has  precisely  the  same  effect  as  slowing  down  the 
machinery  of  a  textile  mill  or  a  shoe  factory.  Less 
units  will  be  produced  and  therefore  just  so  much  less 
can  be  sold  or  collected  for  and  yet  all  the  non-produc¬ 
tive  employees  must  be  paid  just  the  same ;  the  salaries 
of  the  executive  officers,  the  superintendents,  the  ter¬ 
minal  employees,  the  gatemen,  etc.,  etc.,  most  of  the 
charges  for  depreciation  of  the  property  and  also  the 
overhead  charges  for  interest  on  capital,  at  least  so  far 
as  represented  by  bonded  indebtedness,  go  on  just  the 
same. 

Between  1915  and  1922  the  New  Haven  has  spent 
about  $60,000,000  on  the  road  —  bought  new  and  more 
powerful  locomotives  and  built  the  two  great  modern 
classification  yards  at  Cedar  Hill  and  Providence  ex¬ 
pressly  intended  to  expedite  traffic  and  also  put  in 
many  other  important  improvements,  and  yet  we  can 
see  but  little  sign  of  a  speeding  up  of  its  car  movement. 

Delays  in  Classification  Yards 

We  have  made  a  study  of  the  time  consumed  getting 
freight  cars  through  the  three  big  classification  yards 
of  the  New  Haven  system;  in  other  words,  the  time 
consumed  from  the  moment  a  locomotive  pulls  a  car 
into  one  of  these  yards  until  another  locomotive  pulls 


26 


it  out  to  go  on  its  way.  We  are  referring  only  to  cars 
destined  for  points  beyond  the  yard,  so  that  loading  or 
unloading  these  cars  is  eliminated  and  we  are  dealing 
only  with  cars  which  the  railroad  has  entirely  under  its 
own  control  and  for  the  prompt  movement  of  which  it 
alone  is  responsible. 

These  three  big  1 1  hump  ’  ’  classification  yards  of  the 
New  Haven  Railroad  are  located  at  Providence,  New 
Haven  (Cedar  Hill),  and  Maybrook,  at  the  western  end 
of  the  Poughkeepsie  bridge  line.  These  yards  repre¬ 
sent  a  total  investment  by  the  New  Haven  of  more  than 
twelve  millions  of  dollars.  Practically  all  this  money 
has  been  expended  in  recent  years,  so  that  these  yards 
represent  the  latest  ideas  for  obtaining  speed  and  econ¬ 
omy  in  car  sorting  or  classification. 

The  average  number  of  cars  classified  daily  in  the 
year  ending  June  30,  1922,  was  as  follows: 


Maybrook  .  510 

Cedar  Hill  .  2,389 

Providence  .  511 


At  Maybrook  it  is  practically  only  the  cars  moving 
east  that  are  classified;  at  Cedar  Hill  about  an  equal 
number  are  classified  going  each  way;  at  Providence 
only  a  small  proportion  of  the  cars  going  west  are  classi¬ 
fied. 

Each  of  these  three  big  yards  is  equipped  with  a 
hump  ’  ’  to  the  top  of  which  a  locomotive  gradually 
pushes  a  train.  As  the  pushing  locomotive  without 
stopping  pushes  these  cars  successively  to  the  top  of 
the  hump  they  are  uncoupled  and  allowed  to  run  down 
the  opposite  side  by  gravity  in  “  cuts  ”  of  one  or  two 


27 


or  three  or  as  the  desired  classification  may  require, 
towards  the  numerous  assembling  tracks  upon  which 
the  new  classified  trains  are  being  made  up.  An  opera¬ 
tor  in  the  tower  on  the  hump  operates  by  key-board  the 
switches  of  the  assembling  tracks  so  as  to  cause  the 
1  ‘  cuts  ’  ’  to  roll  onto  the  appropriate  track  so  that  they 
may  constitute  a  part  of  the  new  train.  These  cuts 
come  down  the  hump  in  rapid  succession  one  behind  the 
other,  several  rolling  at  the  same  time.  A  brakeman  at 
the  top  of  the  hump  jumps  onto  each  cut  and  regulates 
the  speed  with  the  handbrakes.  He  then  makes  sure 
that  the  automatic  coupler  has  properly  coupled  this 
last  cut  to  the  one  which  preceded  it,  and  then  jumps  on 
a  motor  car  running  at  frequent  intervals  hack  to  the 
top  of  the  hump  where  he  takes  his  position  ready  to 
climb  onto  another  cut.  This  operation  is  continuous 
until  the  train  being  pushed  up  the  hump  has  had  all 
its  cars  “  shaken  out.”  Then  another  freight  train  is 
pushed  up  and  the  work  of  sorting  proceeds. 

The  time  which  elapses  from  the  moment  any  given 
car  enters  one  of  these  big  classification  yards  is  of 
course  not  merely  the  time  occupied  in  1 1  putting  it 
over  ’  ’  the  hump  but  it  includes  all  the  time  which 
elapses  from  the  moment  a  locomotive  pulls  the  car 
into  the  yard  until  a  locomotive  pulls  it  out  and  it  re¬ 
sumes  its  journey. 

We  give  below  the  average  time  it  took  to  get  a  car 
through  the  Maybrook,  New  Haven  and  Providence 
yards  during  the  year  ending  June  30,  1922,  and  also 
for  the  six  months  ending  December  31,  1922.  In  the 
case  of  Maybrook  we  do  not  include  westbound  cars  be¬ 
cause  the  New  Haven  does  not  move  cars  westbound  in 


28 


regular  trains  out  of  the  yard.  At  Providence  only  a 
small  number  of  the  cars  moving  west  are  classified  and 
therefore  we  exclude  these  from  consideration. 

The  average  length  of  time  for  each  car  entering  the 
classification  yards  from  the  time  it  entered  until  it 
was  under  way  again  was 

Year  ending  6  mos.  ending 

June  30,  1922  Dec.  31,  1922 

Maybrook  (east)  . -. . .  13.4  .  38.2  hours 

New  Haven  (Cedar  Hill) .  13.2  .  21.6  “ 

Providence  .  14.8  .  19.7  “ 

We  are  informed  that  9  hours  in  these  yards  is  all 
that  should  be  required  for  the  average  car  under 
reasonable  operating  efficiency,  whereas  the  average 
for  Maybrook  for  the  year  ending  June  30,  1922,  given 
above  is  13.4  hours,  a  period  during  which  the  rail¬ 
road  was  unaffected  by  strike  conditions  or  abnormal 
weather  conditions.  The  Cedar  Hill  yard  where  the 
daily  average  for  the  year  ending  June  30,  1922,  was 
13.2  hours,  and  the  Providence  yard,  where  the  delay 
to  car  movement  averaged  14.8,  also  showed  a  slow 
movement. 

The  following  diagrams  illustrate  the  yard  delays 
and  line  movements  of  the  average  car  during  the  year 
ending  J une  30, 1922,  delivered  by  a  connecting  line  at 
Maybrook  and  bound  for  Mansfield  or  some  other  point 
east  of  Providence,  and  the  movement  of  the  same  car 
with  the  delays  at  the  three  big  classification  yards  re¬ 
duced  to  reasonable  operating  figures : 


29 


Car  Movement 

Maybrook  and  Harlem  River  to  Mansfield 


In  yards 

at  In  transit 

Maybrook  10  hrs. 
13.4  hrs.  124  miles 


Present  Car  Movement 


In  yards  In  yards 

at  at  Mansfield 

Cedar  Hill  Providence 


In  yards  5.5  hrs.  113  miles  19  miles 

at  In  transit 
Harlem  68  miles 
River 
13.6  hrs. 


Present  total  from  Maybrook  to  Mansfield  62.1  hrs. 
“  “  “  Harlem  River  “  “  57.8  hrs. 


Maybrook  Possible  Car  Movement 

9  hrs.  10  hrs. 


Harlem  5.5  hrs 
River 

9  hrs. 


Possible  total  time  from  Maybrook  to  Mansfield  47.5  hrs. 

“  11  “  “  Harlem  River  “  “  43.0  hrs. 

Respective  Reductions  in  Delay  14.6  hrs.  and  14.8  hrs. 


30 


We  turn  back  to  the  classification  carried  on  by  the 
New  Haven  Railroad  in  its  Harlem  River  yard.  For 
tlie  year  ending  June  30,  1922,  tbe  average  time  con¬ 
sumed  in  the  yard  was  13.6  hours ;  for  the  6  months  end¬ 
ing  December  31,  1922,  the  average  time  consumed  was 
22.9. 


Comparison  with  Boston  &  Albany 

In  the  case  of  the  Boston  &  Albany  at  its  western 
end,  cars  moving  to  the  Boston  &  Albany  are  classi¬ 
fied  by  the  New  York  Central  in  its  West  Albany 
yard. 

The  largest  car  classification  carried  on  by  the  Bos¬ 
ton  &  Albany  is  in  the  big  yard  at  West  Springfield. 
This  yard  does  not  have  the  benefit  of  a  “  hump  ’  ’  but 
the  cars  are  switched  onto  the  assembling  tracks  by 
repeated  back  and  forth  movements  of  switching  loco¬ 
motives  as  we  commonly  see  them  in  operation.  For 
the  year  ending  June  30,  1922,  the  average  daily  num¬ 
ber  of  cars  classified  in  this  yard  was  1,220.  The  aver¬ 
age  time  of  cars  in  this  vard  was  6.1  hours,  and  for  the 
6  months  ending  December  31,  1922,  the  average  daily 
number  of  cars  handled  was  1,205,  and  the  average  time 
8.4  hours.  These  are  excellent  records  and  show  a  high 
degree  of  operating  efficiency.  The  6.1  hours  main¬ 
tained  as  the  Boston  &  Albany  average  for  the  year 
ending  J une  30,  1922,  also  indicates  that  the  nine  hours 
allowed  the  New  Haven  in  our  previous  statement  was 
a  reasonable  and  attainable  figure.  The  average  for  51 
representative  railroads  of  the  United  States  was  8.43 
hours. 


31 

Comparison  with  Boston  and  Maine 


Taking  up  next  the  big  “  bump  ”  yard  at  the  western 
end  of  the  Boston  &  Maine  railroad  at  Mechanic ville 
and  the  big  Boston  &  Maine  classification  yard  at 
East  Deerfield,  we  find  that  the  average  daily  number 
of  cars  classified  and  the  time  required  was : 


Mechanicville  (East)  . . 
East  Deerfield  (both 
tions)  . 


direc- 


Year  ending  6  Mos.  ending 
June  30, 1922  Dec.  31, 1922 


Cars 

Hours 

Cars 

Hours 

595 

25.0 

518 

30.1 

1293 

12.7 

1136 

17.3 

We  shall  refer  in  more  detail  to  these  delays  when  we 
come  to  describe  the  operation  of  the  Boston  &  Maine, 
but  it  will  be  noted  that  the  time  required  at  Mechanic¬ 
ville  (25  hours  for  year  ending  June  30,  1922)  showed 
much  greater  delay  than  in  the  case  of  the  three  hump 
yards  of  the  New  Haven  during  the  same  period.  The 
time  required  at  East  Deerfield,  12.7  hours,  was  slightly 
better  than  for  the  New  Haven  yards  but  below  the 
Boston  &  Albany’s  average  of  6.1  hours  at  West  Spring- 
field. 


Time  Lost  in  Placing  Cars 

Another  interesting  comparison  of  operating  effi¬ 
ciency  is  the  time  consumed  by  a  railroad  in  actually 
“placing”  or  “spotting”  a  car  after  it  has  been 
brought  in  to  the  terminal  yard.  It  shows  how  easy  it 
is  in  railroad  operation  to  spill  time  and  therefore  net 
money  all  along  the  right  of  way. 

These  figures  have  been  obtained  from  the  official 
published  reports  of  the  Demurrage  Bureau  at  Boston 


32 


maintained  by  the  New  England  railroads  for  the  pur¬ 
pose  of  dealing  with  demurrage  claims  against  ship¬ 
pers.  The  figures  of  course  are  the  railroads’  own 
figures  furnished  to  the  Demurrage  Bureau. 

Average  Time  Placing  Cars 


1921 

1922 

Jan.  1923 

Feb. 1923 

Hrs.  Min. 

Hrs.  Min. 

Hrs.  Min. 

Hrs.  Min. 

Bangor  &  Aroostook  . . . 

. . .  2 :53 

2:38 

3:22 

3:22 

Boston  &  Albany . 

.  ..  4:19 

4:19 

8:10 

6:14 

Boston  &  Maine . 

.  . .  7  :55 

7:55 

17 :02 

14:53 

Central  Vermont . 

.  ..  7:41 

7:12 

10:34 

10:05 

Maine  Central  . 

.  ..  4:19 

4:05 

6:29 

6:00 

New  Haven . 

.  .  .  6  :43 

7:55 

17:02 

15  :50 

Rutland  . 

, 6:58 

5:46 

7:26 

7:12 

Embargoes 

It  is  obvious  that  in  time  of  business  activity  a  rail¬ 
road  may  accept  from  connecting  lines  so  many  cars 
that  it  will  become  clogged  and  unable  efficiently  to 
conduct  its  transportation.  This  point  has  been 
reached  many  times  in  railroad  history,  but  such  a  sur¬ 
feit  should  be  headed  oft  long  before  it  is  reached.  If 
a  railroad  permits  more  cars  to  come  upon  its  system 
than  it  can  efficiently  handle  it  not  only  injures  or  al¬ 
together  destroys  its  earning  power  as  the  result  of 
the  rapidly  accumulating  car  per  diems,  but  it  also 
does  its  patrons  no  good. 

Railroad  managers  seek  to  guard  against  congestion 
by  an  embargo  which  in  effect  is  notification  to  connect¬ 
ing  railroads  that  they  must  cease  permitting  shippers 
on  their  lines  to  load  cars  for  the  home  railroad.  These 
embargoes  are  nearly  always  limited  scT  as  to  permit 
shippers  to  continue  loading  certain  kinds  of  freight 


33 


varying  according  to  conditions;  generally  foodstuffs, 
perishables,  fruits,  newsprint  paper,  and  a  few  other 
classes  of  merchandise.  Here  in  New  England  during 
most  of  the  recent  embargoes  coal  was  also  made  an 
exception. 

The  policy  of  the  New  Haven  Railroad  is  to  issue  a 
sweeping  embargo,  and  then  the  shipper  applies  to  the 
railroad  for  permission  to  have  a  car  loaded.  The  New 
Haven  road  undertakes  to  pass  upon  the  merits  of  his 
application,  and  the  many  thousands  of  other  applica¬ 
tions  received  from  other  shippers.  For  example,  a 
manufacturer  at  New  Britain  may  apply  for  permission 
to  have  a  car  loaded  with  pig  iron  at  a  furnace  on  the 
Pennsylvania  Railroad.  He  might  admit  in  his  appli¬ 
cation,  or  during  a  conversation  in  person  or  by  tele¬ 
phone  with  the  railroad  official,  that  he  had  already 
some  stock  of  pig  iron  at  his  plant  and  the  official  would 
probably  refuse  his  application.  This  sounds  better  in 
theory  than  it  works  in  practice.  It  puts  a  railroad 
official  into  a  thousand  kinds  of  business  on  his  line. 
Each  shipper  presumably  is  bestacquaintedwith  his  own 
business  and  his  own  needs.  His  only  motive  for  seek¬ 
ing  an  opportunity  to  draw  on  his  bank  balance  to  pay 
some  other  man  for  raw  material  or  merchandise  is  to 
promote  the  systematic  and  orderly  running  of  his 
business  and  to  care  for  his  customers,  or  to  keep  his 
factory  running  smoothly.  His  judgment  and  experi¬ 
ence  tell  him  that  the  time  has  come  to  order  another 
car  load.  To  forbid  him  to  do  this  represents  a  regret¬ 
table  state  of  affairs  where  some  railroad  official  sub¬ 
stitutes  his  judgment  for  the  judgment  of  the  man 
eating  and  sleeping  with  his  own  business. 


r 


34 

In  actual  operation  it  also  gives  rise  to  much  inequal¬ 
ity  if  not  favoritism  and  unfairness.  The  rail¬ 
road  cannot  send  an  employee  to  visit  every  manufac¬ 
turer  and  count  or  weigh  the  merchandise  on  hand. 

Whatever  the  system  of  embargo  may  be,  however, 
wThether  a  published  embargo  with  certain  exceptions 
made  known  to  all  and  then  opened  and  closed  from 
time  to  time  or  a  general  embargo  with  an  occult  and 
inevitably  inequitably  administered  permit  system, 
there  is  no  doubt  that  embargoes  must  at  times  be  put 
into  effect.  It  is  a  question  of  sound  judgment  as  to 
when  the  day  and  the  hour  arrives  to  declare  the 
embargo. 

The  best  managed  roads  in  the  country,  when  the 
cars  on  their  lines  are  nearing  the  congestion  point,  use 
the  embargo  to  avoid  the  threatened  overload.  It 
may  he  necessary  only  for  a  day  or  two,  or  it  may  he 
longer. 

It  may  be  asked  why  not  build  enough  main  line 
tracks,  sidings,  yards  and  terminals  and  keep  in  storage 
enough  extra  locomotives  to  be  ready  to  care  for  a 
traffic  peak,  even  though  it  may  come  only  once  in  four 
or  five  years,  and  then  perhaps  lasts  only  for  three  or 
four  months.  But  to  go  too  far  in  this  direction  is 
unsound.  In  the  long  run  the  cost  of  the  railroads  of 
the  country  falls  upon  the  people  who  use  them,  and 
it  is  not  in  their  interest  any  more  than  in  the  interest 
of  the  railroads  to  maintain  idle,  enormously  expen¬ 
sive  facilities  for  ninety  or  ninety-five  per  cent  of  the 
time  in  order  to  care  for  the  extra  peak  load  which 
shippers  would  like  to  put  on  the  railroads  for  five  or 
ten  per  cent  of  the  time.  Sound  manufacturers  do  not 


35 


make  a  heavy  extra  investment  in  plant  and  subject 
themselves  to  the  loss  of  interest,  upkeep,  taxes,  etc., 
necessary  to  meet  a  short  abnormal  rush  of  orders. 

But  however  this  may  be,  the  officers  of  the  railroad 
charged  with  its  successful  operation  this  day  and  this 
week  must  deal  with  the  situation  as  it  exists  today  and 
this  week.  No  single  question  involved  in  the  success¬ 
ful  operation  of  a  railroad  is  fraught  with  greater  con¬ 
sequence  than  the  right  day  and  the  right  hour  for 
declaring  an  embargo  and  the  degree  of  tightness  with 
which  it  shall  be  enforced.  The  president  of  the  road 
must  have  his  hand  either  directly  or  through  a  trusted 
subordinate  on  the  control  lever.  Once  get  his  road 
jammed  and  it  is  extremely  difficult  to  get  it  running 
smoothly  again.  Meanwhile  no  one  is  being  benefited, 
and  the  credit  of  the  road  is  being  destroyed  by  the 
slow  movement  of  cars  and  the  piling  up  of  adverse  car 
per  diems.  The  president  must  see  the  picture  of  his 
road  not  as  it  might,  could,  would  or  should  be,  but 
exactly  as  it  is  day  by  day.  He  must  watch  closely  by 
the  aid  of  daily  reports  the  number  of  cars  moving  to¬ 
wards  him  on  connecting  lines,  and  particularly  so  be¬ 
cause  an  embargo  does  not  stop  the  cars  already  mov¬ 
ing  or  loaded.  The  cars  will  keep  moving  up  to  his 
gateways  in  large  number  for  ten  days  or  a  fortnight 
after  the  embargo  is  declared,  and  he  must  accept  them 
and  be  responsible  for  the  per  diems  involved.  He 
must  have  in  mind  the  condition  of  his  main  lines,  the 
condition  of  his  yards,  of  his  unloading  tracks,  the  con¬ 
dition  of  his  motive  power,  the  number  of  empties 
awaiting  return,  in  winter  the  temperature  and  snow 
conditions,  labor  conditions,  and  any  and  all  other  con- 


36 


ditions  affecting  the  actual  daily  capacity  of  his  ma¬ 
chine  to  produce  ton  miles. 

Embakgo  Policy  of  New  Haven  Railroad 

Turning  now  to  the  judgment  exercised  by  the  oper¬ 
ating  officials  of  the  New  Haven  road  during  the  last 
eighteen  months  on  this  vital  question,  we  give  for  the 
months  from  January,  1922  to  April,  1923,  the  car 


miles 

per  freight 

car  day  and  the  total 

cars  on  the 

system : 

Daily  Average 

Car  Miles 

Number  Bad 

Cars  on  Line 

Per  Car  Day 

Order  Cars* 

1922- 

-January  . . 

41,958  ... 

. 12.3  ... 

.  9,932 

February  . 

43,260  ... 

. 13.6  . . 

.  10,539 

March  . . . 

44,305  ... 

.  14.9  ... 

.  10,921 

April . 

43,077  ... 

.  13.0  .. 

.  11,272 

May . 

42,430  ... 

.  13.2  ... 

.  11,584 

J une  . 

43,092  ... 

. 13.9  ... 

.  11,637 

July . 

43,342  ... 

.  12.8  ... 

.  11,442 

• 

August  . . . 

44,326  ... 

.  12.3  .. 

.  11,241 

September 

47,228  ... 

. 12.0  .. 

.  11,151 

October  . . 

53,314  ... 

. 11.5  .. 

.  10,856 

November  . 

55,850  ... 

. 12.0  .. 

.  10,728 

December  . 

53,586  ... 

.  9.7  .. 

.  10,080 

1923- 

-January  . 

56,245  ..., 

.  7.5  ... 

.  9,865 

February  . 

59,279  ... 

.  9,341 

March  .... 

61,253  .... 

.  9.0  ... 

.  9,014 

April . 

57,782  ... 

.  11.3  .. 

.  8,689 

It  will  he  observed  that  upon  the  opening  of  easier 
spring  conditions  in  March,  1922,  the  New  Haven’s 
average  car  movement  per  day  was  14.9  miles,  and  that 
the  cars  on  the  road  during  this  month  amounted  to 

*  The  average  number  of  bad  order  cars  for  each  month  is  given  to  make 
clear  that  the  falling  off  in  car  movement  was  not  due  to  an  increase  in 
number  of  bad  order  cars.  If  they  are  taken  into  consideration  the  falling 
off  in  car  movement  would  be  further  accentuated. 


37 


44,305.  Then  during  the  three  following  months  of 
April,  May  and  June  the  movement  averaged  over  13 
miles  a  day,  with  about  43,000  cars  on  the  line  for  each 
of  these  three  months.  Then  came  the  strike  of  the 
shopmen  on  July  1,  not  affecting  the  efficiency  of  the 
engines  much  at  first  but  bound  to  have  a  rapid  cumu¬ 
lative  effect  as  the  need  for  repairs  accumulated.  In 
July  the  car  miles  per  day  dropped  from  the  13.9  miles 
of  June  to  12.8.  Meanwhile  the  total  cars  on  the  line 
began  to  rise  until  by  September  first,  they  were  in  ex¬ 
cess  of  45,000  and  car  miles  per  car  day  dropped  to  12.3 
for  August,  12  for  September  and  11.5  for  October.  A 
quick  halt  should  have  been  called  by  some  restriction 
of  the  cars  coming  on  to  the  system,  especially  in  view 
of  the  patent  daily  difficulties  at  the  locomotive  shops 
and  engine  roundhouses  in  breaking  in  an  entire,  new 
repair  force.  Instead  of  this,  cars  on  the  line  were  al¬ 
lowed  to  go  mounting  up  until  by  October  first  they 
had  gone  up  another  five  thousand  to  about  50,000. 
Still  no  step  was  taken  during  the  whole  month  of  Oc¬ 
tober,  until  the  last  day  arrived  when  an  embargo  was 
announced.  By  this  time  the  cars  on  the  system  had 
reached  54,000  and  the  road  was  in  a  jam  with  ten 
thousand  too  many  cars  on  the  system,  many  of  its 
locomotives  out  of  order  altogether,  and  many  others 
still  running  but  in  bad  condition  and  winter 
approaching. 

During  December,  the  car  miles  per  car  day  took 
a  further  drop  to  9.7  though  we  think  that  December 
weather  conditions  were  about  normal  for  the  season. 
So  the  history  of  the  winter  went  until  in  January  and 
February,  the  average  car  moved  only  about  seven 


38 

and  a  half  miles  a  day,  a  rate  which  would  require  two 
months  for  a  car  to  travel  from  Maybrook  to  Boston 
and  back. 

The  adverse  car  per  diems  on  the  New  Haven  ad¬ 
vanced  to  ruinous  figures  as  follows: 


1922—  May  .  $399,133 

June  .  429,631 

July  .  478,663 

August  . 531,594 

September  .  641,141 

October  .  901,780 

November  . 1,015,010 

December  .  970,617 

1923 —  January . 1,119,934 

February  .  1,077,149 

March  . 1,322,401 

April  .  1,666,707 


Now  while  we  believe  that  a  serious  mistake  was 
made  in  delaying  the  embargo  until  the  31st  of  October 
and  permitting  the  number  of  cars  on  the  line  to  run 
up  from  about  43,000  on  July  1st  to  about  54,000  on 
November  1st,  an  even  more  regrettable  mistake  seems 
to  us  to  have  occurred  after  the  declaration  of  the 
embargo  of  October  31st.  Under  the  New  Haven 
embargo  plan  the  embargo  of  October  31st  was  a  gen¬ 
eral  embargo,  but  in  spite  of  this  declared  embargo, 
permits  began  to  be  issued  at  such  a  rate  that  the  road 
instead  of  being  cleared  of  the  excessive  number  of  cars 
became  worse  and  worse  congested  until  in  March,  the 
average  number  on  the  system  was  61,253,  and  the  ad¬ 
verse  per  diems  for  the  month  $1,322,400.  It  is  true 
the  winter  turned  out  to  be  unusually  adverse,  but  effi- 


39 


cient  embargo  control  could  have  countered  even  the 
winter  to  a  large  extent.  At  any  rate,  conditions  at  the 
locomotive  shops  and  roundhouse  repair  shops  and  the 
condition  of  the  motive  power  were  known  and  could 
have  been  given  greater  weight,  in  determining  the 
embargo  policy. 

New  Haven's  Large  Per  Diem  Payments 

We  give  below  the  annual  sum  due  for  a  series  of 
years  from  the  New  Haven  railroad  to  other  roads  for 
foreign  car  per  diems :  * 


1913  . $3,102,931 

1914  .  2,585,302 

1915  .  2,588,717 

1916  .  5,400,479 

1917  .  5,835,795 

1921  .  4,386,363 

1922  .  5,805,879 


We  omit  the  years  1918,  1919  and  1920,  as  they 
should  be  disregarded  owing  to  disturbed  conditions 
during  and  following  the  war.  During  part  of  1918 
and  1919,  under  war  conditions,  car  per  diems  were 
abolished  as  between  railroads  under  Federal  control. 
During  1920,  cars  had  become  so  widely  scattered  as 
the  result  of  the  war  time  pooling  that  each  line  had  a 
wholly  abnormal  percentage  of  foreign  cars  on  its 
system,  and  but  a  small  percentage  of  its  own  cars. 

It  may  be  urged  that  there  should  be  offset  against 
the  amounts  due  each  year  from  the  New  Haven  to 
other  roads  the  sums  due  to  the  New  Haven  for  car  per 
diems. 

*  Does  not  include  payments  by  Central  New  England. 


40 

We  give  the  figures  for  per  diems  receivable :  * 


1913  . $3,461,679 

1914  .  2,666,342 

1915  .  1,865,401 

1916  .  3,143,530 

1917  .  3,945,226 

1921  .  3,638,418 

1922  .  3,768,902 


This,  however,  is  a  fallacy.  If  the  amount  due  other 
roads  is  excessive  by  reason  of  slow  movement,  it  does 
not  make  it  any  less  excessive  because  the  other  roads 
owe  car  hire  to  the  New  Haven.  The  car  hire  due  the 
New  Haven  really  represents  nothing  but  a  fair  re¬ 
turn  after  deducting  upkeep  and  depreciation  upon 
the  capital  which  the  New  Haven  has  invested  in  car 
equipment.  Any  road,  if  it  had  the  credit  and  the 
desire,  could  keep  on  purchasing  cars  until  the  amount 
due  the  road  for  car  hire  equalled  or  exceeded  the 
amount  it  paid  out,  but  this  would  not  represent  a  sav¬ 
ing  in  car  hire  paid  out,  it  would  merely  represent  a 
return  upon  a  large  additional  investment  of  capital, 
and  in  discussing  efficiency  of  operation  should  not  be 
credited  against  car  hire  paid  out. 

It  should  be  remembered  also  that  if  the  number  of 
car  days  piled  up  against  the  New  Haven  railroad  for 
which  it  must  pay  other  roads  because  of  slow  move¬ 
ment  is  excessive,  there  inevitably  must  be  a  further 
heavy  loss  not  measured  by  this  number  of  foreign  car 
days  or  the  sums  due  foreign  roads.  The  New  Haven’s 
own  cars,  which  in  turn  were  worth  to  it  as  a  mere  in¬ 
vestment  at  least  a  dollar  a  day,  must  have  suffered 
from  the  same  slow  movement,  and  therefore  caused  a 
large  deficiency  in  possible  earnings. 

*  Does  not  include  amounts  received  by  Central  New  England. 


41 


Net  Ton  Miles  Pee  Car  Day 

Let  us  now  examine  the  average  number  of  freight 
ton  miles  “  net  ton  miles/  ’  produced  by  the  New  Haven 
per  car  day  during  the  year  ending  June  30,  1922.  So 
far  as  the  freight  traffic  of  a  railroad  is  concerned,  this 
is  all  the  railroad  is  in  business  for,  viz.,  to  produce 
the  largest  possible  number  of  net  ton  miles  per  car 
per  day.  Good  business  judgment  must  of  course  be 
exercised  to  keep  the  right  balance  between  cost  of  per 
diems  and  cost  of  train  service  (year  ending  June  30, 
1922)  : 


Boston  &  Albany .  365 

Atlantic  &  St.  Lawrence .  347 

Central  Vermont  .  268 

Maine  Central  .  264 

Rutland  .  247 

Boston  &  Maine .  246 

New  Haven  .  198 

Bangor  &  Aroostook .  186 


The  operating  figures  of  the  Boston  and  Albany  sys¬ 
tem  show  that  each  car  during  the  twelve  months 
ending  June  30,  1922,  produced  on  the  average  each 
day  365  net  ton  miles.  For  the  same  period  each  car 
on  the  Boston  &  Maine  system  produced  246  net  ton 
miles.  On  the  New  Haven  system,  only  198  net  ton 
miles  per  car  day  were  produced.  The  year  referred 
to  does  not  include  any  part  of  the  shopmen’s  strike; 
it  does  include  three  months  of  the  coal  strike.  But  the 
Boston  &  Maine  and  the  Boston  &  Albany,  as  well  as 
the  New  Haven,  both  carry  a  large  quantity  of  coal. 
It  may  be  said  that  the  Boston  &  Albany  is  helped  in 


42 

the  production  of  its  large  number  of  net  ton  miles 
per  car  day  because  it  has  less  branches  than  the  New 
Haven,  but  the  Boston  &  Maine  has  quite  as  large  a 
percentage  of  branches  as  the  New  Haven.  The  Maine 
Central  is  also  burdened  with  a  heavy  percentage  of 
branches.  Yet  the  Maine  Central  produced  264  net 
ton  miles  per  car  day  during  the  same  year.  The 
Bangor  &  Aroostook  railroad  produced  186  net  ton 
miles.  This  road  also  has  a  good  deal  of  branch 
line  mileage  besides  its  main  line,  and  is  further 
handicapped  by  the  fact  that  the  potato  crop  in 
Aroostook  County,  which  contributes  a  large  element 
in  its  total  traffic,  is  a  seasonal  crop  and  more¬ 
over  requires,  during  most  of  the  hauling  period,  spe¬ 
cial  heater  cars,  which  must  be  accumulated  on  the  line 
before  the  crop  begins  to  move,  and  besides  have  the 
disability  of  not  being  suitable  to  be  thrown  into  other 
traffic  if  standing  at  a  terminal  or  loading  point  and 
not  needed  for  potato  loading. 

Passenger  Operation 

The  discussion  in  this  report  of  the  New  Haven’s 
operation  has  been  confined  to  the  operation  of  its 
freight  service  for  this  branch  of  railroad  operation 
presents  the  most  difficult  problems.  Passenger  opera¬ 
tion  is  relatively  simpler.  The  New  Haven  derives 
slightly  more  than  half  of  its  gross  revenue  (51  per 
cent)  from  carrying  freight,  which  compares  with  50 
per  cent  for  the  Boston  &  Albany  and  61  per  cent  for 
the  Boston  &  Maine. 

The  relative  importance  of  freight  and  passenger 
service  is  very  nearly  the  same  on  the  Boston  &  Al- 


43 


bany  as  on  the  New  Haven  but  the  proportion  of  pas¬ 
senger  train  miles  to  freight  train  miles  is  larger  on 
both  the  New  Haven  and  Boston  &  Maine  because  of 
their  large  volume  of  suburban  commutation  busi¬ 
ness.  It  is  true,  however,  on  all  of  these  roads  that  the 
operation  of  freight  service  is  affected  by  the  necessity 
for  keeping  freight  out  of  the  way  of  a  heavy  passenger 
service,  particularly  within  the  suburban  zones  of 
Boston  and  New  York. 

Speaking  generally,  the  New  Haven’s  passenger  serv¬ 
ice  is  well  conducted  although  during  the  past  winter 
it  was  necessarily  much  affected  by  the  bad  condition 
of  motive  power,  resulting  from  the  shop  strike. 

The  New  Haven  is  fortunate  in  its  large  volume  of 
through  passenger  business  at  high  rates.  The  New 
Haven  financial  and  operating  problem  in  large  measure 
seems  to  be  how  to  increase  the  profits  to  be  derived 
from  its  freight  traffic. 

Locomotive  Repairs 

We  have  made  a  comparison  of  the  cost  of  locomotive 
repairs  on  the  New  Haven  railroad.  Many  factors 
should  be  taken  into  account  in  comparing  these  costs. 
It  is  work  done  bv  the  locomotive  as  measured  in  loco- 

t / 

motive  miles  that  wears  out  the  parts  and  makes  neces¬ 
sary  repairs  and  replacements,  though  high  speeds  and 
heavy  train  loads  are  factors  also.  Switch  engines  have 
a  wear  and  tear  disproportionate  to  the  locomotive 
miles  produced  so  that  the  relative  percentage  of 
switching  would  to  some  degree  affect  a  comparison 
between  roads.  The  relative  size  of  locomotives,  com¬ 
monly  measured  in  drawbar  pull  or  tractive  power,  is 


44 


also  a  factor  of  importance.  The  repair  of  heavy  loco¬ 
motives  is  more  costly  than  the  repair  of  light  locomo¬ 
tives.  The  average  age  of  locomotives  also  should  be 
given  consideration. 

We  give  a  table  showing  for  each  New  England  road 
the  average  number  of  locomotive  miles  per  locomotive, 
the  average  cost  of  repairs  per  locomotive  mile,  the 
average  tractive  power  per  locomotive,  the  average  age, 
and  the  average  cost  of  repairs  per  locomotive.  For 
comparative  purposes  we  give  these  figures  for  the 
years  1921  and  1922,  hut  as  the  New  Haven  and  Boston 
&  Maine  were  seriously  affected  by  the  shop  strike  in 
the  last  six  months  of  1922,  we  shall  consider  only  the 
comparison  for  the  year  1921. 


Cost 

Per 

Locomo¬ 
tive  Mile 
(Cents) 

Year  Ending 
Dec.  31,  1921 

New  Haven — Electric  -  24.371 


New  Haven — Steam  .  85.035 

Boston  &  Maine  .  30.674 

Maine  Central  .  21.956 

Boston  &  Albany  .  23.520 

Bangor  &  Aroostook  .  24.236 

Central  Vermont  .  26.471 

Rutland  .  18.191 


Year  Ending 
Dec.  31,  1922 

New  Haven — Electric  -  18.859 


New  Haven — Steam  .  43.965 

Boston  &  Maine  .  31.160 

Maine  Central  .  20.577 

Boston  &  Albany  .  19.403 

Bangor  &  Aroostook  .  20.801 

Central  Vermont  .  1S.711 

Rutland  .  17.273 


Cost  per 
Tractive  50,000 
Miles  Cost  of  Power  lbs. 

Per  Repairs  Per  Trac- 

Loco-  Per  Loco-  Locomo-  tive 
motive  motive  tive  (lbs)  Power 


50,927 

$12,412 

38,018 

$16,324 

18,124 

6,350 

31,097 

10,209 

20,535 

6,300 

27,715 

11,366 

24,000 

5,269 

31,149 

8,458 

28,369 

6,672 

36,240 

9,206 

19,599 

4,750 

25,674 

9,250 

25,713 

6,806 

27,454 

12.397 

24,364 

4,432 

32,046 

6,914 

Aver. 

Age 

(Yrs.) 

52,493 

9,900 

38,851 

12,741 

12.9 

18,018 

7,921 

31,702 

12,494 

18.8 

20,779 

6.473 

28,473 

11,369 

17.4 

25,157 

5,176 

31,294 

8,271 

15.6 

29,091 

5,644 

36,450 

7,743 

15.5 

21,627 

4,498 

25,617 

8,745 

19.0 

26,857 

5,025 

24,965 

9,074 

25.5 

25,540 

4,411 

32,046 

6,883 

18.2 

45 


Comparing  tlie  four  large  New  England  roads  we 
find  as  measured  in  cost  per  locomotive  mile,  the  New 
Haven  cost  of  steam  locomotive  repairs  in  1921  was 
35  cents ;  the  Boston  &  Maine  30.7  cents ;  the  Boston  & 
Albany  23.5  cents;  and  the  Maine  Central  22  cents. 
On  the  basis  of  cost  per  locomotive,  which  does  not  take 
into  account  either  tractive  power  or  the  locomotive 
miles  travelled,  the  Boston  &  Albany  is  highest,  $6,672 
per  locomotive;  New  Haven  $6,350;  Boston  &  Maine 
$6,300 ;  and  Maine  Central  $5,269.  It  will  be  seen,  how¬ 
ever,  that  the  Boston  &  Albany  and  Maine  Central  both 
get  a  much  higher  mileage  out  of  their  locomotives  than 
the  two  larger  roads.  If  the  cost  of  repairs  is  stated  on 
the  basis  of  cost  per  50,000  pounds  tractive  power, 
which  takes  into  effect  the  relative  size  of  the  locomo¬ 
tives,  the  New  Haven  is  lower  than  the  Boston  &  Maine, 
but  considerably  higher  than  the  Maine  Central  or  Bos¬ 
ton  &  Albany.  The  average  tractive  power  of  the  New 
Haven’s  locomotives  is  greater  than  that  of  the  Bos¬ 
ton  &  Maine,  practically  the  same  as  the  Maine  Central, 
and  much  below  that  of  the  Boston  &  Albany.  The 
average  age  of  the  locomotives  on  the  New  Haven  was 
18.8  years  in  1922,  as  compared  with  17.4  years  on  the 
Boston  &  Maine ;  15.6  years  on  the  Maine  Central ;  and 
15.5  years  on  the  Boston  &  Albany. 

The  difference  in  age  of  the  locomotives  on  the  New 
Haven,  and  the  difference  in  operating  conditions  un¬ 
doubtedly  explain  in  part  the  spread  between  the  New 
Haven’s  cost  and  that  of  the  Maine  Central  and  Boston 
&  Albany,  but  the  difference  seems  to  indicate  room  for 
considerable  improvement  on  the  New  Haven  in  reduc¬ 
ing  the  cost  of  locomotive  repairs.  This  is  a  large  item 


46 


in  the  cost  of  railroad  operation,  locomotive  repairs 
costing  the  New  Haven  for  its  steam  locomotives  $7,- 
841,916  in  1921,  a  year  of  dull  business.  If  the  New 
Haven  could  have  reduced  the  cost  of  steam  locomotive 
repairs  in  1921  from  35  cents  per  mile  to  30  cents, 
the  saving  would  have  amounted  to  $1,126,889. 

Constructive  Mileage 

The  figures  reported  by  the  New  Haven  railroad  to 
the  Interstate  Commerce  Commission  for  the  calendar 
year  1922,  show  that  the  train  employees  actually  ran 
115,644,792  miles.  These  are  “men  miles  that  is, 
this  is  a  sum  obtained  by  taking  the  actual  mileage 
travelled  by  each  train  employee  during  the  calendar 
year  1922,  and  adding  them  together.  But  ‘  ‘  Construc¬ 
tive  ”  mileage  is  another  element  which  must  be  taken 
into  consideration  in  the  operation  of  a  railroad.  If  a 
freight  engineer  has  a  run  of  just  one  hundred  miles 
and  makes  it  in  eight  hours,  at  the  average  rate  of  12% 
miles  per  hour,  he  is  paid  the  standard  day’s  pay,  but 
if  because  of  a  short  division  or  for  some  other  reason 
he  runs  only  50  miles  and  does  his  day’s  work  in  4 
hours,  he  will  be  paid  for  50  constructive  miles  and 
receive  the  same  pay  as  the  previous  engineer  who  ac¬ 
tually  ran  one  hundred  miles.  It  is  not  necessary  to 
go  into  the  intricacies  of  the  many  rules  relating  to  the 
allowance  of  constructive  mileage.  Suffice  it  to  say 
that  while  the  total  miles  actually  run  during  1922  by 
train  employees  on  the  New  Haven  railroad  was 
115,644,792,  the  road  under  the  rules  relating  to  con¬ 
structive  mileage  paid  for  an  additional  42,954,502  con¬ 
structive  miles  not  actually  run.  The  road  paid  for 


47 


37.14  per  cent  more  miles  than  it  actually  received.  Other 
things  being  equal,  a  train  crew  operating  a  local  pas¬ 
senger  train,  because  they  do  not  attain  the  standard 
passenger  distance,  often  must  be  paid  for  twice  the 
distance  they  actually  travel.  This  same  thing  would 
be  true  in  regard  to  a  local  freight  which  keeps  stop¬ 
ping  to  drop  and  pick  up  cars,  and  therefore  cannot 
make  the  standard  day’s  run.  This  general  principle 
as  applied  to  the  pay  of  the  men  is  necessary  and  fair. 
Unfortunately  the  distance  from  Harlem  River  to  the 
big  Cedar  Hill  classification  yard  of  the  New  Haven  sys¬ 
tem  is  only  68  miles,  and  this  has  been  established  as  an 
engine  run.  Accordingly  every  engine  crew  and  train 
crew  that  operate  a  freight  train  from  Harlem  River 
to  the  Cedar  Hill  yard  actually  deliver  to  the  New 
Haven  railroad  68  train  miles,  but  the  road  must  pay 
for  100;  that  is  to  say,  it  must  pay  for  nearly  50  per 
cent  more  miles  than  it  actually  receives. 

Each  railroad  management  will  strive  to  lay  out  its 
system  so  as  to  get  as  many  runs  of  a  hundred  miles  for 
its  freight  engines  and  crews  as  possible,  but  this  in 
practice  can  never  be  wholly  accomplished,  and  still  less 
can  it  be  accomplished  on  systems  like  the  New  Haven 
or  the  Boston  &  Maine  and  the  Maine  Central  where 
there  are  many  branches  of  irregular  lengths.  Some¬ 
times  the  distance  is  such  that  a  crew  can  be  given  a 
“  turn  around  ”  run  for  the  purpose  of  building  up  the 
distance  to  more  nearly  the  hundred  miles. 

We  call  attention  to  this  heavy  constructive  mileage 
on  the  New  Haven  railroad,  but  we  do  not  make  any 
criticism  in  regard  to  it  because  whether  a  saving  can 
here  be  made  can  only  be  determined  by  the  executive 


48 

officers  of  the  road  who  are  living  with  it  day  by  day 
and  year  by  year. 

It  might  be  thought  that  the  constructive  mileage 
given  above  was  largely  built  up  by  the  crews  employed 
on  switching  engines,  but  this  is  not  the  case  because 
their  basis  of  pay  is  different.  It  might  be  thought 
that  through  freights  could  be  operated  with  a  mini¬ 
mum  of  constructive  mileage  but  the  figures  given  by 
the  New  Haven  railroad  for  the  actual  mileage  of  the 
engine  and  train  crews  of  through  freights  during  1922 
amounted  to  a  total  of  26,610,378  miles.  The  road  paid 
these  men,  in  addition  to  these  actual  miles,  for 
10,822,275  constructive  miles. 

Overtime  Pay 

In  addition  to  the  heavy  expense  involved  in  adding 
to  the  miles  actually  run,  37  per  cent  more  constructive 
mileage,  the  New  Haven  railroad  paid  for  2,304,772 
hours  of  overtime  in  1922.  These  overtime  hours  repre¬ 
sent  chiefly  actual  extra  hours  on  the  job  beyond  the 
standard  day  of  8  hours.  In  some  cases  they  represent 
probably  extra  compensation  for  a  “  wide  spread.”  As, 
for  example,  if  a  man  works  for  8  hours  continuously, 
other  things  being  equal,  he  receives  8  hours’  pay.  If 
he  should  work,  however,  from  8  to  12  in  the  morning 
and  then  from  6  to  10  in  the  evening,  he  has  still  worked 
a  total  of  only  8  hours,  but  the  spread  of  his  day’s  work 
is  more  than  12  hours,  and  the  inconvenience  or  hard¬ 
ship  of  this  wide  spread  is  compensated  for  by  allow¬ 
ing  “constructive  overtime.”  The  principle  of  over¬ 
time  is  fair  and  speaking  generally,  the  road  is  actually 
receiving  service  during  most  of  these  overtime  hours, 


49 


but  overtime  costs  more  than  regular  time,  generally 
time  and  a  half,  and  the  skillful  manager  strives  to 
keep  the  total  hours  of  overtime  requiring  this  50  per 
cent  bonus  down  as  much  as  he  can. 

Materials  and  Supplies 

We  have  had  a  careful  study  made  of  the  handling 
of  materials  and  supplies  on  the  various  New  England 
railroads,  including  the  amount  of  inventory  carried. 

The  inventory  of  materials  and  supplies  on  the  New 
Haven  for  the  past  three  years,  with  number  of  months 
the  supply  on  hand  would  last,  has  been  as  follows : 


Dec.  31  Months’ 
1920  Supply 

Coal  . $2,151,251  1.2 

Rails  .  803,927  9.4 

Ties  .  742,882  5.3 

Lumber  .  1,106,565  9.2 


All  other  stores  12,072,718  11.6 


Total 

Inventory  $16,S77,343 


Dec.  31  Months’  Dec.  31  Months’ 

1921  Supply  1922  Supply 

$2,815,377  2.1  $1,344,122  1.0 

253,286  4.5  570,817  8.9 

788,234  2.8  1,139,332  5.4 

777,507  6.1  669,937  6.5 

9,684,685  10.9  8,409,042  8.9 


$14,319,089  $12,133,250 


It  is  clear  that  in  1920,  apart  from  coal,  rails,  ties 
and  lumber,  the  balance  of  “  all  other  stores  ”  was 
quite  out  of  hand.  It  represented  practically  a  year’s 
supply,  and  instead  of  having  over  twelve  millions  of 
the  road’s  capital  locked  up  it  should  not  have 
amounted  to  more  than  six  millions,  which  would  have 
been  six  months’  supply. 

It  is  the  opinion  of  experts  on  railroad  supplies  that 
excessive  supplies  cost  on  the  average  at  least  fifteen 
per  cent  a  year,  made  up  of  interest,  deterioration,  ob¬ 
solescence,  storage  facilities,  taxes,  insurance,  extra 
handling  and  accounting,  so  that  this  excess  of  six  mil- 


50 


lions  represented  an  annual  loss  going*  on  at  the  rate 
of  $900,000  per  year.  Happily  the  present  head  of  the 
purchasing  and  stores  department  has  been  cutting  this 
down  rapidly,  and  we  have  little  doubt  that  by  the  end 
of  the  current  year  he  will  have  his  inventory  of  “  all 
other  stores  ”  down  to  seven  millions,  and  then  in  the 
year  following  to  six  millions,  which  would  represent 
an  average  six  months’  supply,  and  be  good  railroad 
practice.  The  Boston  &  Maine  inventory  of  “  all  other 
stores  ”  on  December  31,  1922,  was  down  to  an  average 
of  six  months,  twenty-one  days. 

The  present  purchasing  agent  of  the  New  Haven 
came  to  the  road  about  two  years  ago,  and  the  depart¬ 
ment  appears  to  be  now  w*ell  organized  and  well  con¬ 
ducted. 

Physical  Condition 

The  physical  condition  of  the  New  Haven,  in  so  far 
as  roadbed,  track,  signals,  bridges,  ordinary  buildings 
and  other  roadway  structures  is  concerned  may  be  con¬ 
sidered  to  be  excellent,  capable  of  handling  its  high¬ 
speed  passenger  trains  and  heavy  freights  with  econ¬ 
omy  and  safety.  In  respect  to  the  capacity  of  the 
roundhouses  and  their  equipment,  we  consider  many 
of  them  inadequate  for  the  pressure  of  business  put 
upon  them  in  busy  periods.  This  does  not  involve  a 
large  sum  of  money  to  be  expended  at  any  one  time,  but 
it  is  important  that  the  work  should  be  begun,  because 
it  is  at  the  roundhouses  that  minor  repairs  (requiring 
less  than  24  hours)  are  made  and  these  should  be  made 
quickly  so  as  to  get  the  locomotives  back  at  work  in 
the  minimum  of  time.  The  ability  of  the  roundhouses 
to  make  some  of  the  heavier  repairs  efficiently  and 


51 


promptly  instead  of  the  main  shops  is  also  an  im¬ 
portant  factor  in  keeping  locomotives  in  service  and 
reducing  the  cost  of  locomotive  repairs. 

Density 

Speaking  of  the  system  as  a  whole,  all  parts  of  it 
have  main  track  and  yard  facilities,  adequate  for  the 
present  business  and  for  from  25  to  50  per  cent  in¬ 
crease.  The  heaviest  traffic,  both  passenger  and 
freight,  is  between  New  Haven  and  Harlem  River. 
From  New  Haven  to  New  Rochelle  there  are  four 
tracks,  and  from  New  Rochelle  to  Harlem  River  there 
are  six  tracks.  These  tracks  are  capable  of  carrying 
a  considerably  larger  number  of  trains,  probably  50 
per  cent  in  excess  of  the  present  number.  From  New 
Haven  to  Providence,  where  there  are  only  two  tracks 
most  of  the  way,  there  is  still  unused  capacity  which, 
under  efficient  operation,  could  accommodate  at  least  50 
per  cent  more  trains.  Between  Maybrook  and  Devon, 
where  the  Maybrook  line  joins  the  main  Shore  Line, 
the  tracks  can  carry  at  least  100  per  cent  more  trains. 
Between  New  Haven  and  Springfield  there  exist  ample 
track  and  facilities  for  carrying  a  heavier  movement. 
Over  the  old  New  York  and  New  England  railroad,  be¬ 
tween  Hartford  and  Boston,  there  are  two  tracks  most 
of  the  way,  but  the  traffic  reaches  only  about  the  ca¬ 
pacity  of  a  single  track  line.  It  seems  unnecessary  to 
comment  on  other  parts  of  the  system. 

Futuee  Capital  Expenditukes 

As  a  policy  in  regard  to  further  capital  expenditures, 
we  believe  the  New  Haven  should  make  no  large  capital 


52 


expenditures  during  the  next  few  years  except  year  by 
year  a  moderate  sum  to  increase  and  improve  the  facili¬ 
ties  at  the  roundhouses  and  main  shop  machinery,  and 
no  doubt  here  and  there  moderate  amounts.  It  seems 
to  us  the  active  effort  of  the  management  should  be 
concentrated  in  trying  to  use  to  the  utmost  advantage 
the  things  which  it  now  possesses.  The  company,  we 
are  advised,  with  the  new  power  now  on  order  will  have 
sufficient  engine  power  to  handle  its  present  business 
if  the  engines  are  kept  in  good  operating  condition, 
and  for  quite  a  period  of  time  capital  outlay  in  this 
direction  probably  can  be  limited  to  the  cost  of  re¬ 
placing  with  heavier  engines  some  of  the  smaller  ones 
as  they  wear  out. 

The  present  excessive  number  of  bad  order  freight 
cars,  amounting  to  over  eight  thousand,  should  be  re¬ 
duced  to  the  normal  figure  of,  say,  three  thousand  cars. 
So  far  as  the  rebuilt  cars  may  be  strengthened  and 
have  attached  more  modern  draft  gear  and  other  im¬ 
provements,  this  justifies  a  charge  to  capital  account. 


\ 


53 


FINANCIAL  CONDITION  OF  THE  NEW 

HAVEN 

Period  of  Expansion,  1902-1913 

Beginning  in  the  year  1902,  the  New  Haven  manage¬ 
ment  inaugurated  a  policy  of  expansion  with  the  evi¬ 
dent  purpose  of  obtaining  control  of  most  of  the  steam 
railroads  in  the  New  England  states;  control  of  trolley 
and  interurban  electric  railway  systems  in  southern 
New  England  and  southeastern  New  York,  parallel  to 
or  radiating  from  its  own  rail  lines ;  and  also  control  of 
various  coastwise  steamship  lines  as  well  as  additional 
boat  lines  operating  through  Long  Island  Sound  to 
New  York. 

Pursuant  to  that  policy  the  New  Haven  acquired 
during  the  ten  years  between  1902  and  1913 : 

Steam  Railroads 

1.  Control  of  Central  New  England  Railway. 

2.  Control  of  the  Boston  &  Maine  Railroad  which  at  the 

time  carried  control  of  the  Maine  Central  Railroad. 

3.  One-half  of  a  controlling  interest  in  the  Rutland  Rail¬ 

road  with  an  agreement  to  buy  the  other  half  from 
the  New  York  Central  (subsequently  enjoined  by 
the  New  York  Court  and  never  carried  into  effect). 

4.  Agreement  with  the  New  York  Central  to  share 

equally  in  the  profits  or  losses  of  the  Boston  & 
Albany  road.  Agreement,  made  in  1911  and  ter¬ 
minated  early  in  1914,  resulting  in  a  small  loss  to 
the  New  Haven,  about  $168,000.' 


54 


5.  During  the  same  period  the  New  Haven  acquired  the 
control  of  the  New  York,  Ontario  &  Western  Rail¬ 
road.  This  road  is  wholly  in  the  states  of  New 
York  and  Pennsylvania. 

Street  Railways 

Nearly  all  the  street  and  interurban  railways  in  the 
state  of  Rhode  Island  and  in  the  state  of  Connecticut, 
and  a  large  mileage  in  Massachusetts,  including  the 
Worcester  System,  the  Springfield  System  and  the 
Berkshire  Street  Railway  System. 

The  two  street  railways  operating  through  the  sub¬ 
urban  territory  along  the  Sound  in  New  York  State 
(Westchester  Street  Railroad  and  New  York  &  Stam¬ 
ford  Railway). 

The  New  York,  Westchester  and  Boston  Railway, 
financed  by  the  New  Haven,  a  rapid  transit  line  from 
129th  St.,  New  York,  to  New  Rochelle  and  White 
Plains,  connecting  with  the  elevated  and  subway 
systems  in  New  York. 

Steamship  Lines 

Merchants  &  Miners  Transportation  Company. 
Eastern  Steamship  Company. 

Hartford  &  New  York  Transportation  Company. 

The  above  investments  were  for  the  most  part  ac¬ 
quired  at  high  prices,  representing  in  many  cases,  and 
particularly  in  the  case  of  the  trolley  properties,  a  cost 
much  in  excess  of  physical  values. 

This  policy  of  expansion  outside  its  own  railroad 
system  practically  terminated  in  the  year  1913,  except 


1. 


2. 


3. 


55 

as  to  the  expenditures  necessary  to  complete  certain  of 
the  acquired  properties. 

The  legal  conflicts  of  the  company  with  the  United 
States  Government  and  the  State  of  Massachusetts,  re¬ 
sulting  from  some  of  these  transactions,  are  a  matter 
of  record  and  need  not  be  dwelt  on. 

At  the  time  this  campaign  of  expansion  was  under¬ 
taken,  trolley  and  interurban  railway  properties  were 
in  good  credit,  with  increasing  earnings,  and  were  re¬ 
garded  by  many  as  potential  competitors  of  the  steam 
railroads  for  passenger  traffic.  The  Boston  &  Maine 
was  then  earning  substantial  dividends  and  the  New 
York,  Ontario  &  Western  was  paying  sufficient  divi¬ 
dends  to  carry  the  New  Haven’s  investment  in  the 
stock. 

The  Committee  believes  that  it  would  not  be  helpful 
or  constructive  to  comment  in  this  report  on  the  policy 
of  the  former  management  in  undertaking  this  expan¬ 
sion  program.  Nevertheless,  no  intelligent  diagnosis  of 
New  Haven’s  financial  problem  can  be  made  without 
taking  into  account  the  results  of  this  expansion  policy 
and  the  extent  to  which  it  has  impaired  the  New 
Haven’s  financial  resources. 

Amount  of  Investment  in  Outside  Properties 

The  annual  report  of  the  New  Haven  Company  to 
its  stockholders  for  the  year  ending  June  30,  1915, 
states  that  during  the  period  from  July  1,  1903,  to 
June  30,  1915,  there  was  acquired  additional  prop¬ 
erty  with  book  values  aggregating  $393,071,491. 


56 

Included  in  that  total  were  the  following  outside  in¬ 


vestments  : 

Boston  &  Maine  and  leased  line  stocks . $31,079,668.75 

New  York,  Ontario  &  Western  Railroad 

stock  .  13,108,397.62 

Rutland  Railroad  securities .  2,514,977.15 


Total  outside  railroad  investments . $46,703,043.52 


New  York,  Westchester  & 

Boston  Railway . $  38,850,150.09 

Various  other  trolley  lines 

and  securities  .  100,527,389.53  $139,377,539.62 


Various  Steamship  Lines  14,242,718.81 

Total  of  above  investments  between  July 
1,  1903,  and  June  30,  1915 .  $200,323,301.95 


Since  June  30,  1915,  there  have  been  large  further 
increases  in  the  cost  to  the  New  Haven  of  some  of 
these  outside  properties,  because  they  have  produced 
little  income  for  the  New  Haven,  and  in  some  cases 
have  received  considerable  further  cash  advances. 

For  a  number  of  years  after  the  New  Haven  made 
most  of  these  outside  investments  the  results  of  its  own 
railroad  operations,  and  the  income  received  from  its 
street  railway  and  other  outside  properties,  except  the 
New  Yrork,  Westchester  &  Boston,  which  was  under 
construction,  enabled  it  to  maintain  its  credit  and  con¬ 
tinue  to  pay  8  per  cent  dividends.  But  about  1913 
began  the  decline  in  earnings  of  a  large  proportion  of 
the  street  railway  companies  in  the  LTnited  States,  due 


57 


to  automobile  and  jitney  competition,  and  especially  to 
increases  in  wages  and  other  costs,  and  inability  to  in¬ 
crease  fares  promptly.  Then  came  the  failure  of  tbe 
New  York,  Westchester  &  Boston  Railway  to  fulfill 
the  estimates  that  within  two  or  three  years  after  the 
opening  of  the  line  it  would  earn  its  fixed  charges. 
That  property  up  to  1915  represented  a  cost  to  the 
New  Haven  of  over  $38,000,000,  and  during  ten  years 
of  its  operation  it  has  not  been  able  to  earn  in  full  even 
its  operating  expenses  and  taxes,  the  deficit  before  de¬ 
ducting  fixed  charges  having  been  $351,539,  and  the 
deficit  after  fixed  charges  including  interest  due  the 
New  Haven  having  been  $16,369,835.  Last  year 
(1922)  it  earned  a  small  margin  (about  $50,000) 
applicable  to  interest  charges.  The  Boston  &  Maine 
was  obliged  to  discontinue  dividends  on  its  common 
stock  in  1913  and  has  paid  none  since.  The  New  York, 
Ontario  &  Western  has  paid  dividends  in  12  of  the  18 
years  of  New  Haven  control.  The  Rutland  Railroad 
has  taken  care  of  itself  and  gradually  improved  its 
property,  but  only  two  dividends  of  2  per  cent  each 
have  been  paid  since  the  New  Haven’s  investment  in 
the  stock. 

Losses  of  New  Havex  ox  Outside  Ixvestmexts 

The  New  Haven  has  written  oft  its  books  a  large 
amount  of  losses  sustained  through  some  of  these  in¬ 
vestments.  It  has  liquidated  its  holdings  in  the  Rhode 
Island  trolley  properties  and  in  the  Eastern  Steamship 
Company,  New  England  Navigation  Company  and 
Merchants  &  Miners  Transportation  Company.  The 


58 


loss  on  these  four  investments,  already  written  oft, 
amounts  to  $40,546,840.  This  has  been  written  oft  and 
is  net.  The  New  Haven  has  also  charged  to  its  income 
account  a  large  amount  of  interest  on  guaranteed  or  as¬ 
sumed  securities  of  these  outside  properties  and  has, 
in  effect,  written  off  considerable  further  losses  by 
omitting  to  charge  on  its  books  interest  on  some  of 
these  outside  investments  that  have  failed  to  pay  such 
interest. 

The  losses  thus  already  written  off  by  the  New 
Haven,  including  the  definite  loss  above  of  $40,546,840, 
aggregate  approximately  $53,000,000,  divided  as  fol¬ 
lows  : 


The  Rhode  Island  Co.  (Trolley 
properties  in  Rhode  Island) . . .  $29,729,656 

Merchants  &  Miners  Transportation 

Co .  3,594,500 

New  England  Navigation  Co .  6,275,809 

Eastern  Steamship  Co .  946,875 

New  York,  Westchester  &  Boston 

By.: 

Advances  (written  down)  ....  $9,983,899 

Discount  on  bonds  sold .  1,265,295 

Liquidation  of  Millbrook  Co.  .  1,163,084  12,412,278 


$52,959,118 

Besides  this  amount  already  charged  off,  over 
three-fourths  of  which  represents  loss  on  the  original 
investment  already  realized  upon  the  sale  or  final  liqui¬ 
dation  of  the  assets  disposed  of,  there  is  a  present  sub¬ 
stantial  shrinkage  in  the  value  of  various  important 
investment  items  still  retained  by  the  company. 


59 


These  remaining  “  outside  investments,”  after  the 
above  write-offs,  were  carried  on  the  New  Haven’s 
books  on  December  31,  1922,  at  the  following  valua¬ 
tions  : 


Outside  Steam  Railroad  Investments 

Book 

Valuation 

Boston  Railroad  Holding  Company  $26,350,400 

This  investment  comprises  the  entire  Common 
Stock  ($3,106,500  par  value)  and  $24,493,900 
out  of  $27,293,000  4  per  cent  Preferred  Stock 
of  the  Holding  Company.  The  remaining 
$2,800,000  Preferred  Stock  is  held  outside  and 
is  guaranteed  by  the  New  Haven  as  to  prin¬ 
cipal  and  dividends.  The  investments  owned 
by  the  Holding  Company  consist  of  Boston  & 

Maine  securities  as  follows:  Common  Stock 
$21,918,900  (par  value),  Preferred  Stock 
$654,300  (par  value)  and  a  $1,000  4  per  cent 
Bond. 

Boston  &  Maine  First  Preferred  Stocks  B,  C,  & 


D,  par  value  $415,100 .  816,544 

Various  Railroad  Stocks  and  Securities  (chiefly 
Boston  &  Maine  leased  lines)  par  value 
$608,123  .  743,809 

New  York,  Ontario  &  Western  Stocks, 

$29,162,200  par  value  or  50.2  per  cent  of 

total  outstanding  .  13,108,397 

Rutland  Railroad  Preferred  Stock  $2,352,050 
par  value  or  25.4  per  cent  of  total  outstanding  2,364,977 


Total  Outside  Steam  Railroad  investments.  .$43,384,127 


60 

Street  and  Suburban  Railway  Properties 

Book 

Valuation 

Connecticut  Company  (entire  stock 
and  certain  securities  owned,  par 

value  $45,568,916) . $45,568,916 

New  York,  Westchester  &  Boston 
Railway  Company  (entire  capital 
stock  and  certain  securities 
owned,  par  value  $22,670,342)  . .  13,813,923 
New  England  Investment  &  Secur¬ 
ity  Company  5  per  cent  Notes  due 
1924  (par  value  $13,115,000) ....  13,037,750 
(representing  equity  in  Worces¬ 
ter  Consolidated  Street  Railway 
and  Springfield  Street  Railway, 
etc.) 

Berkshire  Street  Railway  Co.  (en¬ 
tire  capital  stock  and  certain 
securities  owned,  par  value 

$9,990,600)  .  9,931,156 

Vermont  Company  (entire  capital 
stock  and  certain  securities 
owned,  par  value  $1,496,000) . . .  1,417,664 

New  York  &  Stamford  Railway 
Company  (entire  capital  stock 


and  certain  securities  owned, 

par  value  $1,396,432) .  1,415,396 

Westchester  Street  Railroad  Com¬ 
pany  (entire  capital  stock  and 
certain  securities  owned,  par 

value  $1,193,043)  . . . . . .  1,398,609 

Shore  Line  Electric  Railway  Co. . .  117,000 

United  Electric  Railway  Co .  300,000 


Total  Street  and  Suburban  Rail¬ 
way  properties  . 


$87,000,414 


61 


Total  outside  steam  railroad  and 

street  railway  investments  ....  $130,384,541 

It  has  not  seemed  to  the  Committee  useful  or  indeed 
possible  to  estimate  what  has  been  or  may  be  the  ulti¬ 
mate  loss  to  the  New  Haven  upon  these  other  assets. 
Such  estimates  are  at  best  unsatisfactory.  That  the 
losses  will  be  heavy,  if  the  investments  should  be  dis¬ 
posed  of  in  the  near  future,  is  beyond  question.  For 
the  most  part  they  are  bringing  in  little  if  any  income, 
while  to  the  extent  that  they  were  acquired  with  the 
proceeds  of  New  Haven  bonds  or  notes  their  owner¬ 
ship  represents  a  permanent  fixed  charge  upon  the 
company.  Anyone  interested  may  consider,  for  ex¬ 
ample,  the  book  valuation  of  the  New  York,  West¬ 
chester  &  Boston  as  of  December  31,  1922,  of 
$13,813,923  (after  already  writing  down  $12,412,278), 
consisting  chiefly  of  stocks,  notes  and  advances,  held  in 
the  New  Haven’s  treasury  and  representing,  with  the 
exception  of  $2,190,000  of  these  bonds  owned  by  the 
New  Haven  itself  only  an  equity,  subject  to  $19,200,000 
4%  per  cent  first  mortgage  bonds  in  the  hands  of  the 
public,  guaranteed  principal  and  interest  by  the  New 
Haven.  These  bonds  are  quoted  on  the  New  York 
Stock  Exchange  at  about  42%  of  face  value,  and  to  this 
price  the  New  Haven  guaranty  of  course  contributes 
something.  How  can  the  value  of  the  stock  and  notes 
coming  after  these  bonds  be  figured? 

For  the  $73,186,491  book  value  of  December  31, 1922, 
of  various  trolley  securities  other  than  New  York,  West¬ 
chester  and  Boston  still  held  by  the  New  Haven,  it 
seems  impossible  to  suggest  any  basis  for  an  intelligent 
estimate  of  present  value.  Apparently  little  income 
has  been  derived  from  them  for  several  years. 


62 


It  is  clear  that  to  the  $52,959,118  of  capital  already 
written  off  as  lost  there  must  be  added  a  large  sum, 
impossible  at  present  to  calculate,  and  that  these  past 
and  probable  future  losses  taken  together  constitute 
a  most  important  factor  in  the  New  Haven’s  financial 
condition  and  credit  position  today. 

Amount  of  Increase  in  Capitalization  due  to 
Outside  Investments 

On  December  31,  1922,  the  New  Haven’s  outstand¬ 
ing  capitalization  was: 

Funded  Debt  (including  guaranteed  bonds 


of  Central  New  England  Railway) . $317,239,595 

Capital  Stock  (par  value) .  157,117,500 


Total  . $474,357,095 

If  it  had  no  investments  in  these  outside 
steam  railroad  and  street  railway  properties, 

which  on  that  date  amounted  to .  130,384,541 

The  total  capitalization  on  December  31,  1922, 
would  then  have  been  only  about .  343,972,554 


If  the  New  Haven  were  not  burdened  with  these 
outside  investments  and  thus  had  total  capital  liabili¬ 
ties  of  only  $344,000,000  instead  of  $474,357,095,  the 
company  would  be  in  comfortable  financial  condition. 

Our  best  estimate  of  what  would  have  been  the  divi¬ 
sion  of  these  $344,000,000  capital  liabilities  between 
funded  debt  and  stock  is  as  follows: 

Funded  Debt 
Capital  Stock 


$344,000,000 


$220,600,000 

123,400,000 


63 


It  seems  conservative  to  estimate  that  because  of 
these  outside  investments  there  has  been  an  increase 
probably  of  at  least  $96,000,000  in  the  funded  debt 
alone.  We  estimate  that  these  outside  investments 
cost  the  New  Haven  in  interest  charges  alone  at  least 
$3,840,000  for  the  year  1922,  against  which  the  New 
Haven  received  income  of  only  about  $422,000  in  that 
year. 

The  Government  Loans 

The  company  on  December  31, 1922,  owed  the  United 
States  Government  $83,946,500,*  carrying  interest  at 
6%,  and  secured  by  collateral  consisting  of  $93,068,000 
First  and  Refunding  Mortgage  6%  Bonds  of  the  New 
Haven  Railroad  and,  in  addition,  by  other  stocks  and 
bonds  owned  by  the  New  Haven. 

It  is  evident  from  the  above  recitals  that  the  financial 
condition  of  the  New  Haven  Company  would  have 
been  acute  before  this  if  the  government  had  not  loaned 
this  $83,946,500.*  Further  loans  from  the  government 
since  December  31,  1922,  have  brought  this  total  up  to 
$88,646,500,*  and  $3,400,000  additional  have  been 
authorized  by  the  United  States  Treasury  Department 
but  not  yet  taken  down  by  the  company. 

Increase  in  Physical  Valuation  Does  Not  Help 
Road's  Earning  Power 

It  is  true,  as  the  officers  of  the  company  urge,  that 
the  tentative  valuation  of  the  Interstate  Commerce 
Commission,  swelled  by  the  gain  in  market  value  of 

*  This  does  not  include  $1,186,800  Equipment  Trust  obligations  held 
by  the  Director  General  of  Railroads,  and  subject  to  resale. 


64 


the  real  estate,  and  by  the  increased  cost  of  replacing 
at  present  prices  road  construction,  bridges  and  other 
structures  and  equipment,  may  be  said  to  have  re¬ 
stored  these  losses,  and  may  some  day,  somehow,  re¬ 
ceive  recognition.  But  the  writing  up  of  book  value 
does  not  extricate  the  road  as  a  going  concern  from  its 
present  financial  difficulty.  If  the  terminals  in  Boston 
have  doubled  or  trebled  in  value  this  does  not  reduce 
the  cost  of  operating  the  Boston  terminal  or  result  in 
more  net  money  to  meet  fixed  charges.  On  the  con¬ 
trary,  it  involves  higher  taxes  and  therefore  less  money 
to  meet  fixed  charges.  It  is  akin  in  some  respects  to 
the  situation  in  which  a  manufacturing  plant  finds  it¬ 
self  with  perhaps  fifty  acres  of  land  which  has  become 
extremely  valuable.  The  fact  that  the  fifty  acres  have 
greatly  increased  in  value  does  not  help  the’  manufac¬ 
turer  to  turn  out  his  product  more  cheaply  or  to  meet 
the  competition  of  another  plant  located  upon  fifty 
acres  of  land  worth  farm  prices. 

Rates  in  New  England  must  keep  step  with  rates  else¬ 
where  and  especially  with  the  rates  of  other  competi¬ 
tive  regions.  If  the  New  Haven  Railroad  attempts  to 
substitute  the  enhanced  valuation  of  its  property  for 
the  $53,000,000  capital  lost  and  for  the  large  losses  not 
yet  determined  in  its  outside  investments  and  to  raise 
correspondingly  its  charges,  the  cost  to  traffic  will  be 
greater  than  can  be  borne.  The  industries  on  its 
system  are  likely  to  wither,  and  new  industries  to  locate 
elsewhere.  If  a  general  country-wide  raising  of  rates 
is  put  into  effect  by  the  National  Government  in  order 
to  recognize  the  rise  in  values,  then  New  England  can 
move  up  with  the  rest  of  the  country  and  the  security 


EXHIBIT  A 


Yeah 
Ending 
June  30 


1908 

1909 

1910 

1911 

1912 

1913 

1914 

1915 

1916 

Yeah  Ending 
Dec.  31 

1916  (6mos.) 

1917 

1918  A 


1919 

1920 

1921 

1922 


NEW  10RK,  NEW  HAVEN  &  HARTFORD  (INCLUDING  CENTRAL  NEW  ENGLAND)  CONDENSED  INCOME  ACCOUNT 

1908  TO  1922 


Railway 
Opera  tinq 
Revenues 


*56,992,162 

58,900,937 

65,939,695 

67,677,51S 

70,S33,9S0 

73,930,320 

70,998,422 

69.434,310 

81,182,586 


44,756,488 

91,262,181 

10S,357,36S 

113,302,52S 

131,330,785 

124,7S8,023 

130,037,392 


Railway 

Operating 

Expenses 


$40,539,866 

38,4SS,276 

41,337,285 

43,704,S38 

44,919,702 

50,159,367 

51,565,237 

46,700,638 

53,715,S64 


29,003,333 

65,58S,54S 

93,257,298 

99,027,570 

134,744,057 

112,424,782 

105,206,092 


Percent 

Expenses 

to 

Revenues 


71.13 

65.34 

62.69 

64.58 

63.42 

67.S5 

72.63 

67.26 

66.17 


64.80 

71.87 

86.06 

87.40 

102.60 

90.09 

80.90 


3 

Railway 

Net 

Operating 

Revenues 


$16,452,296 

20,412,661 

24,602,410 

23,972,6S0 

25,914,278 

23,770,953 

19,433,185 

22,733,672 

27,466,722 


15,753,155 

25,673,633 

15,100,070 

14,274,958 

-3,413,272 

12,363,241 

24,831,300 


4 

Taxes 


$3,406,055 

3,523,143 

4,088,252 

3,744,217 

3,910,610 

3,839,270 

3,695,023 

2,883,162 

3,024,697 


1,673,000 

3,557,566 

3,496,526 

4,29S,833 

4,736,792 

4,739,943 

4,874,487 


Uncollec¬ 

tible 

Railway 

Revenues 


$7,866 

5,961 


2,493 

6,317 

16,271 

28,946 

17,131 

47,141 

30,840 


6 

Hire  op 
Freight 
Cars 
(Net) 


7 

Other 

Equipment 

Rents 

(Net) 


-Italics  indicate 
Deficit 


$740,462  E 
514,570 
205,102 

Note  E 
$41,529 
-101,184 

-200,356 
-204,160 
-102,784  B 

-78,560 
-92,339 
-13,162  b 

174,512  B 
384,600 
2,513,191 

-269,348  B 
152,679 
306,152 

1,120,966 

2,433,346 

1,073,649 

238,626 

341,714 

-74,988 

614, 6S0 
2,73S,904 
1,677,576 

7,S3S 

-37,121 

-290,185 

2,880,235 

10S,5S8 

-Italics  indicate 

8 

Joint 

Facility 

Rents 

(Net) 


$1,445,425 

1,789,701 

1,477,456 

1,634,321 

1,927,046 

2,153,994 

2,394,212 

2,598,939 

2,739,904 


1,409,426 

3,000,874 

3,209,344 

3,498,535 

3,698,718 

4,151,400 


9 

Total 
Taxes  and 
Rents 
(Cols.  4  to  8) 


$5,591,942 

5,86S,943 

5,669,626 

5,099,622 

5,541,157 

5,877,318 

5,994,399 

6,027,246 

8,589,905 


4,444,511 

9,339,817 

7,720,802 


10 

Net  Rail¬ 
way  Operat¬ 
ing  Income 


$10,860,354 

14,543,718 

18,932,784 

18,873,058 

20,373,121 

17,893,035 

13,43S,7S6 

16,706,426 

1S,876,S17 


11,308,644 
16,333,816 
7,379,268  A 


8,448,832  5,S26,126  A 

11,154,424  -14,567,698  A 
10,325,875  2,037,366 


4,111,110  12,005,260 


12,826,040 


Percent 
Column 
10  to 
Column  1 


Credit 


A  Federal  and  Corporate  Accounts  combined  for  columns  1  to  10. 

B  Estimated  for  Central  New  England. 

C  —  Includes  Central  New  England  dividend  of  $149, SSS  over  99%  of  which  is  included  in  Non-Operating  Income. 
D  —  Central  New  England  dividend  over  99%  of  which  is  included  in  Non-Operating  Income. 

E-STQrrt  °f®qUipment  rents  between  Hire  of  F™gkt  Cars  and  Other  Equipment  Rents  not  reported  for 
1906  Net  total  of  equipment  rents  is  shown  under  Hire  of  Freight  Cars. 

F  -  Excludes  from  Non-Operating  Income  annual  rental  from  Connecticut  Company  account  lease  of  Connecticut 
Railway  and  Lighting  Co.,  and  same  amount  from  Rent  for  Leased  Roads. 

G  —  Guarantee  account  Boston  Railroad  Holding  Co.  dividend  eliminated  from  Other  Deductions  and  same  amount 
deducted  from  Non-Operating  Income,  leaving  net  income  from  this  stock  in  Non-Operating  Income. 


19.06 

24.69 

2S.71 

27.89 

28.76 

24.20 

18.93 

24.06 

23.25 


25.27 

17.90 

6.81 

5.14 

Def. 

1.63 

9.86 


-Italics  indicate 
Deficit 


11 

Non- 

Operating 

Income 


$7,659,525 

9,120,956 

9,037,467 

8,805,606 
9,701,140  G 
9,352,57S  G 

5,957,761  H 
4,080,571  ?H 
4,712,518  F 


2,642,226  F 
5,297,889  F 
4,381,600  F 

5,502,786  F 
4,866,920  F 
6,859,543  F 

5,474,090  F 


12 

Government 

Guarantee 

Adjusted 


$9,675,543  I 

8,820,556  I 
26,315,477  I 


13 

Total  Income 
Available  for 
Fixed  Charges 
(Cols.  10,11,12) 


$1S,519,879 

23,664,674 

27,970,251 

27,678,664 

30,074,261 

27,246,213 

19,396,547 

20,786,997 

23,589,335 


13,950,870 

21,631,705 

21,430,411 

20,149,468 

16,614,701 

8,896,909 

18,300,130 


14 

Rent  for 
Leased 
Roads 


4,673,005 

4,890,297 

5,225,571 

4,570,164 

4,597,840 

4,678,623 

4,890,538 
5,083,493  F 
5,008,812  F 


2,501,737  F 
5,008,955  F 
5,032,923  F 

5,056,983  F 
5,054,281  F 
5,056,026  F 

5,055,717  F 


15 

Interest 

ON 

Debt 


$7,733,546 

11,001,238 

11,295,657 

11,324,866 

11,008,905 

11,525,896 

12,393,888 

11,696,471 

11,858,696 


5,595,223 

12,473,776 

13,321,634 

13,750,613 

14,099,816 

15,473,874 

16,408,228 


16 

Other 

Deductions 


$348,689 

222,845 

237,268 

243,902 
268, 2S0  G 
1,205,040  G 

1,613,437  H 
1,289,772  H 
1,427,655 


703,918 

1,507,068 

1,647,810 

1,626,582 

1,737,330 

1,970,663 

1,825,642 


17 

Total  Fixed 
Charges 
,Cols.  14, 15, 16) 

18 

Net  Income 
Applicable  to 
Dividends 
(Cols.  13  to  17) 

19 

Dividends 

Paid 

20 

Balance 

of 

Income 

Year 
Ending 
June  30 

$12,755,240 

$5,764,639 

$8,279,046 

-$2,514,407 

1908 

16,114,380 

.  7,550,294 

7,883,842 

-333, 54S 

1909 

16,758,498 

11,211,755 

9,759,081 

1,452,674 

1910 

16,138,932 

11,539,732 

12,454,852 

-915,120 

1911 

15,875,025 

14,199,236 

14,315,540 

-116,304 

1912 

17,409,559 

9,836,654 

13,486,563 

-3,649,909 

1913 

18,897,863 

498,684 

2,506,657  C 

-2,007,973 

1914 

18,069,736 

2,717,261 

320,826  D 

2,396,435 

1915 

IS, 295, 163 

5,294,172 

320, 80S  D 

4,973,364 

1916 

Year  Ending 
Dec.  31 

1916  (6moa.) 

8,800,878 

5,149,992 

149,876  D 

5,000,116 

18,989,799 

2,641,906 

256,398  D 

2,385,508 

1917 

20,002,367 

1,434,044 

1,434,044 

1918 

20,434,178 

-284,710 

640,684  D 

-925,394 

1919 

20,891,427 

-4,276,726 

-4,276,726 

1920 

22,500,563 

-13,603,654 

-13,603,654 

1921 

23,289,587 

-4,9S9,457 

320,322  D 

-5,309,779 

1922 

—Italics  indicate  —Italics  indicate 

Deficit  Deficit 

H  -  Dividend  from  Boston  Railroad  Holding  Co.  stock  eliminated  from  Non-Operating  Income  and  same  amount 
deducted  from  Other  Deductions,  leaving  net  loss  from  this  stock  in  Other  Deductions. 

I  Government  Guarantee  Adjusted  represents  the  difference  between  the  Net  Railway  Operating  Income  guar- 
n  eed  by  the  Government  and  the  Net  Railway  Operating  Income  earned  by  the  United  States  Railroad 
Administration  during  Federal  control  and  by  the  corporation  during  the  Guaranty  Period  after  adjustment 
for  Revenues  and  Expenses  prior  to  January  1,  1918.  J 


65 


holders  and  especially  the  stockholders  of  the  New 
Haven  Railroad  may  reap  a  substantial  benefit. 

To  a  certain  extent  the  relative  price  paid  for  trans¬ 
portation  by  different  sections  or  communities  is  more 
important  than  the  actual  price. 

Earnings 

A  study  of  the  Income  Account  of  the  New  Haven 
Company  (including  the  Central  New  England)  for 
each  of  the  15 y2  years  from  June  30, 1907,  to  December 
31,  1922,  is  given  in  Exhibit  A  on  the  opposite  page. 
This  statement  shows  that  the  company’s  net  revenue 
from  railroad  operations  (column  10)  as  well  as  its  in¬ 
come  over  fixed  charges  (column  18)  reached  the  peak 
in  the  year  ending  June  30, 1912.  It  should  also  be  ob¬ 
served  that  the  years  1918,  1919  and  1920  include  the 
period  of  government  control  and  government  guaran¬ 
ties,  and  are  therefore  not  properly  comparable  with 
other  years. 

Growth  of  Traffic 

The  volume  of  traffic  on  the  New  Haven  has  shown 
a  steady  growth  in  both  freight  and  passenger  business. 
In  1921  and  1922  there  was  a  falling  off  from  the  war 
time  peak  of  1918  and  1919,  but  this  decline  was  gen¬ 
eral  on  all  the  railroads  of  the  country.  Revenue  ton 
miles  in  1922  were  17  %  higher  than  in  1912  and  pas¬ 
senger  miles  18.1%  greater.* 

*  Appendix  H.  Revenue  Ton  Miles  and  Passenger  Miles.  New  Haven 
Railroad  1903-1922  (chart),  and  Appendix  I.  Volume  of  Freight  and  Pas¬ 
senger  Traffic,  Revenues,  and  Rates.  New  Haven  Railroad  1912-1922. 


66 

Comparison  of  Yeaes  1922  and  1912 

The  following  comparison  of  Income  Accounts  of 
tlie  New  Haven  (including  Central  New  England)  for 
the  year  ending  June  30, 1912,  with  the  year  1922  gives 
a  significant  picture  of  the  financial  decline  of  the 
New  Haven  Company,  and  indicates  some  of  the  rea¬ 
sons  for  that  decline. 

Year  Ending  Year  Ending 
June  30, 1912  Dec.  31, 1922  Increase  Decrease 
Railway  Operating  Revenue  $70,833,980  $130,037,392  $59,203,412 
Railway  Operating  Expenses  44,919,702  105,206,092  60,286,390 


Railway  Net  Operating  Rev¬ 
enues  . $25,914,278  $24,831,300  $1,082,978 


Taxes  and  Rents 

Taxes  .  3,910,610  4,874,487  963,877 

Equipment  rentals  (net)  ...  296,499  cr.  2,988,823  dr.  3,285,322 

Joint  Facility  Rents  (net)  1,927,046  4,111,110  2,184,064 

Uncollectible  Railway  Reve¬ 
nues  .  .  30,840  30,840 


Total  Taxes  and  Rents 

5,541,157 

12,005,260 

6,464,103 

Net  Railway  Operating 

Income  . 

20,373,121 

12,826,040 

7,547,081 

Non-operating  Income  (net) 

9,701,140  A 

5,474,090  B 

4,227,050 

Total  Income  Applicable 

to  Fixed  Charges  .... 

30,074,261 

18,300,130 

11,774.131 

Fixed  Charges 

Rentals  of  Leased  Roads.. 

4,597,840 

5,055,717  B 

457,877 

Interest  on  Debt  . 

11,008,905 

16,408,228 

5,399,323 

Other  Deductions  ( Guaran- 

ties,  etc. )  . 

268, 2S0  A 

1,825,642  B 

1,557,362 

Total  Fixed  Charges  . . 

15,875,025 

23,289,587 

7,414,562 

Net  Income  Applicable  to 

Dividends  . 

14,199,236 

4,989,457  Def. 

19,188,693 

Dividends  paid  . 

14,315,540 

320,322  C 

13,995,218 

Balance  of  Income 


116,304  Def.5,309,779  Def. 


5,193,475 


67 


A  —  Excludes  $148,741  from  Non-Operating  Income  and  Other  Deductions  in 
1912  in  connection  with  operations  of  Boston  Railroad  Holding  Co., 
leaving  $818,943.  net  dividends  from  this  property  in  Non-Operating 
Income. 

B  —  Excludes  $1,049,564  from  Non-Operating  Income  and  also  from  Rentals 
of  Leased  Roads,  representing  annual  rental  from  the  Connecticut  Co. 
account  lease  of  Connecticut  Railway  and  Lighting  Company. 

C — ‘Central  New  England  Dividends  paid  to  New  Haven  and  included 
in  its  Miscellaneous  Income. 


During  the  10-year  period  covered  by  the  above  state¬ 
ment  a  net  profit  of  $14,199,236  (before  dividends)  in 
1912  was  changed  to  a  net  deficit  of  $5,309,779  in  1922, 
representing  a  decrease  in  net  income  of  $19,509,015. 

Attention  is  especially  directed  to  the  following 
items : 

1.  Increase  in  cost  of  rental  of  equipment .  $3,285,322 

2.  Decrease  in  Non-operating  Income  chiefly 
due  to  cessation  of  revenue  from  outside  in¬ 
vestments  (trolley  properties,  steamship 
properties,  Boston  &  Maine  stock,  New 


York,  Ontario  &  Western  stock,  etc.) .  4,227,050 

3.  Increase  in  Guaranties,  etc.  (chiefly  New 
York,  Westchester  &  Boston  guaranty  and 

other  losses  through  guaranties)  .  1,557,362 

4.  Increase  in  taxes .  963,877 


A  total  of .  $10,033,611 


The  decrease  in  non-operating  income  (Item  2)  is 
due  chiefly  to  the  collapse  in  earnings  from  investments 
in  outside  trolley  and  steamship  properties,  and  in  the 
Boston  &  Maine  Railroad,  which  occurred  in  the  years 
1913  and  1914. 

The  increase  in  charges  for  guarantees  of  securities 


G8 


of  outside  companies  (Item  3)  is  largely  due  to  the 
investment  in  the  New  York,  Westchester  &  Boston. 

Had  it  not  been  for  the  above  items  of  loss  in  net 
revenue  (resulting  from  increased  cost  of  equipment 
rental,  decrease  in  income  from  outside  investments, 
and  increase  in  guarantees) ,  the  company  would  have 
shown  last  year  a  surplus  of  about  $3,760,000  over  fixed 
charges  instead  of  a  deficit  of  $5,309,779. 

But  the  losses  from  the  above  causes  are  only  a 
part  of  the  picture.  The  increase  in  annual  interest 
charges  in  the  year  1922,  as  compared  with  1912,  was 
$5,399,323  of  which  approximately  $3,500,000  or  two- 
thirds  was  due  to  an  increase  in  debt  and  about  $1,900,- 
000  was  due  to  an  increase  in  the  average  rate  of  in¬ 
terest  paid.  The  increase  in  debt  was  as  follows : 

Funded  and  Floating  Debt 


June  30,  1912  .  $248,909,846 

December  31,  1922  .  317,239,595 

Increase  .  $68,329,749 


This  increase  in  debt  was  to  pay  for  additions 
and  improvements  to  the  road  and  equipment  during 
the  ten  years. 

In  spite  of  the  large  amount  invested  in  its  operated 
railroad  properties  during  the  last  ten  and  one-half 
years,  the  company  showed  an  actual  decrease  of 
$1,082,978  in  railway  net  operating  revenue  *  in  1922  as 
compared  with  1912. 


Before  charging  taxes,  rental  of  equipment,  and  joint  facility  rents. 


69 


Comparative  Expense  Ratios  1908-1922 

The  following  statement  shows  the  ratios  of  expenses 
to  total  railway  operating  revenue  each  year  from  1908- 
1922  inclusive : 


- Opi 

CRATING 

i  Expenses - 

Year 

Way  & 

-Maintenance 

Equip- 

Total 

Transpor-  Other 

tation  Ex- 

Total 

Operat- 

Taxes 

and 

Total 

Operating 

Expenses 

ending 

Struc- 

ment 

Mainte- 

Ex-  penses 

ing  Ex- 

Rents 

Taxes  and 

June  30 

1908 

tures 

11.33 

12.65 

nance 

23.98 

penses 

43.01  4.14 

penses 

71.13 

9.81 

Rents 

80.96 

1909 

11.14 

10.45 

21.59 

39.64  4.11 

65.34 

9.96 

75.30 

1910 

11.59 

10.21 

21.80 

36.14  4.74 

62.68 

8.60 

71.28 

1911 

11.22 

11.03 

22.25 

37.63  4.70 

64.58 

7.53 

72.11 

1912 

10.35 

11.74 

22.09 

36.87  4.46 

63.42 

7.82 

71.24 

1913 

11.43 

13.46 

24.89 

38.14  4.82 

67.85 

7.95 

75.80 

1914 

13.26 

15.29 

28.55 

39.81  4.27 

72.63 

8.44 

81.07 

1915 

12.29 

14.66 

26.95 

36.39  3.92 

67.26 

8.68 

75.94 

1916 

11.42 

13.91 

25.33 

37.04  3.80 

66.17 

10.58 

76.75 

Year 
ending 
Dec.  31 

1917 

10.92 

13.95 

24.87 

42.05  4.95 

71.87 

10.23 

82.10 

1918 

13.56 

20.28 

33.84 

47.08  5.04 

85.96 

7.04 

93.00 

1919 

13.97 

20.04 

34.01 

47.85  5.18 

87.04 

7.18 

94.22 

1920 

17.24 

24.52 

41.76 

54.90  5.94 

102.60 

8.49 

111.09 

1921 

15.18 

22.95 

38.13 

46.27  5.69 

90.09 

8.28 

98.37 

1922 

13.76 

21.15 

34.91 

41.23  4.77 

80.91 

9.23 

90.14 

Results  for  First  Four  Months  of  Current  Year 

4  mos.  4  mos. 

1922  1923  Increase  Decrease 

Railway  Operating  Revenue. . .  .  $39,704,059  $44,220,448  $4,516,389 
Railway  Operating  Expenses  .  .  .  30,763,024  37,486,093  6,723,069 

Ratio  of  Expenses  to  Revenues  .  77.48  84.77  7.29 


Railway  Net  Operating  Revenues 

$8,941,035 

$6,734,355 

$2,206,680 

Taxes  and  Rents 

Taxes . 

Rental  of  Equipment  (net) . 

Joint  Facility  Rents . 

Uncollectible  Railway  Revenues, 

1,632,067 

550,130 

1,325,340 

6,786 

1,722,792 

2,913,967 

1,370,105 

46,974 

$90,725 

2,363,837 

44,765 

40,188 

Total  Taxes  and  Rents . 

$3,514,323 

$6,053,838  $2,539,515 

Net  Railway  Operating  Income. 
Non-operating  Income  (net)*  .. 

$5,426,712 

1,903,000 

$680,517 

2,035,000 

$4,746,195 

132,000 

Total  Income  Applicable  to 

Fixed  Charges . 

Fixed  Charges  * . 

$7,329,712 

7,703,000 

$2,715,517 

7,715,000 

$4,614,195 

$12,000 

Net  Income  (deficit) . 

$373,288 

$4,999,483 

$4,626,145 

*  Excludes  $350,000.00,  being  one-third  of  annual  rental  on  account  of 
lease  of  Connecticut  Railway  and  Lighting  Co. 


70 


There  was  an  increase  of  $3,438,443  in  expenses  for 
Maintenance  of  Equipment,  caused  by  the  necessity 
for  heavy  repairs  to  cars  and  locomotives.  (Bad  or- 
der  freight  cars  were  reduced  by  about  1,100  during 
the  four  months.)  Further  large  increases  in  Main¬ 
tenance  of  Equipment  will  be  required  before  the 
freight  cars  and  locomotives  are  brought  into  good 
operating  condition. 

The  increase  of  $2,363,837  in  rental  of  equipment 
was  due,  in  part,  to  the  large  number  of  unserviceable 
cars  on  the  road  and  in  part  to  the  fact  that  the  road 
was  still  flooded  with  foreign  cars  that  it  was  unable 
to  move  promptly, — because  the  number  of  freight 
cars  on  its  line  exceeded  its  capacity  for  prompt  move¬ 
ment. 

It  will  be  seen  that  the  above  two  causes  alone  more 
than  account  for  the  increase  of  $4,626,000  in  the 
deficit  for  the  four  months. 

Poor  Outlook  for  1923 

The  management  has  estimated  that  the  calendar 
year  1923  will  show  about  the  same  deficit  as  in  1922. 
In  order  to  fulfill  this  estimate  the  company  will  have 
to  earn  in  the  last  eight  months  of  1923  nearly  $5,000,000 
net  more  than  it  earned  in  the  same  eight  months  of 
1922.  In  view  of  existing  conditions  as  regards  car  per 
diem  costs  and  the  necessity  for  further  large  increases 
in  costs  of  repairs  and  renewals  of  equipment,  it  seems 
almost  inevitable  that  the  year  1923  will  show  a  con¬ 
siderable  deficit. 

It  is  evident,  therefore,  that  with  the  present  rates 


71 


and  volume  of  traffic  the  New  Haven  cannot  reason¬ 
ably  hope  to  show  any  surplus  over  fixed  charges  un¬ 
less  and  until  a  radical  improvement  occurs  in  its  per 
diem  costs  and  in  its  costs  of  maintenance;  and  even 
if  and  when  those  two  handicaps  are  removed,  we 
believe  there  is  little  hope  that  the  company  can  show 
for  many  years  to  come  a  margin  of  earnings  suffi¬ 
cient  to  restore  its  credit  unless  a  reduction  can  be 
made  in  its  fixed  charges  or  unless  a  considerable  in¬ 
crease  can  be  obtained  in  its  division  of  freight  rates 
with  connecting  lines,  or  other  important  sources  of  in¬ 
creased  revenue  can  be  developed. 

Early  Maturities  of  New  Haven  Debt 

The  New  Haven  must  pay  or  refund  the  following 
indebtedness  during  the  next  12  years: 

Interest  Principal 

Year  Name  of  Security  Rate  Amount 

1924  Meriden  Horse  Railroad  Co.,  Cons.  mtg.  5%  $415,000 

New  Haven  Station  debenture  .  5%  100,000 

Hartford,  Manchester  &  Rockville  Tram¬ 
way  Co.,  first  mtg.  .  5%  200,000 

♦Equipment  Trust  certificates  . Various  1,531,900 

Real  Estate  mortgages  .  6%  160,000 

U.  S.  Government  loan  (Treasury)  -  6 %  100,000 

Total  in  1924  .  $2,506,900 

1925  European  loan  of  1907  (extended)  ....  7%  24,431,251 

♦Equipment  Trust  certificates  . Various  1,434,900 

Danbury  &  Norwalk  general  mtg . 5%  150,000 

Pawtuxet  Valley  Railway  1st  mtg .  4%  160,000 

U.  S.  Government  loan  (Director  General 

of  Railroads)  .  6%  4,290,000 

U.  S.  Government  loan  (Treasury)  -  6%  100,000 


Total  in  1925  .  $30,566,151 

♦Includes  $98,900  due  U.  S.  Government  (Director  General). 


72 


Interest  Principal 

Year  Name  of  Security  Rate  Amount 

1926  ♦Equipment  Trust  certificates  . Various  $1,189,900 

U.  S.  Government  loan  (Treasury)  ....  6%  100,000 

Total  in  1926  .  $1,289,900 

1927  *Equipment  Trust  certificates  . Various  $939,900 

U.  S.  Government  loan  (Treasury)  ....  6%  100,000 

Total  in  1927  .  $1,039,900 

1928  *Equipment  Trust  certificates  . Various  763,900 

Meriden  Southington  &  Compounce 

Tramway  1st  mtg .  5%  175,000 

U.  S.  Government  loan  (Treasury)  ....  6%  100,000 

Total  in  1928  .  $1,038,900 

1929  *Equipment  Trust  certificates  . Various  592,900 

U.  S.  Government  loan  (Treasury)  _  6%  100,000 

Total  in  1929  .  $692,900 

1930  *Equipment  Trust  certificates  . Various  426,900 

Hartford  Street  Railway  1st  mtg .  4%  2,500,000 

Hartford  Street  Railway  Debentures  . .  4%  165,000 

Consolidated  Railway  Debentures  3,  SV2  &  4%  969,650 

Naugatuck  Railroad .  3 234,000 

U.  S.  Government  loan  (Director  General 

of  Railroads)  .  6%  60,026,500 

U.  S.  Government  loan  (Treasury)  ....  6%  100,000 

Total  in  1930  .  $64,422,050 

1931  *Equipment  Trust  certificates  . Various  $426,900 

Greenwich  Tramway,  1st  mtg .  5%  320,000 

U.  S.  Government  loan  (Treasury)  _  6%  8,160,000 

Total  in  1931  .  $8,906,900 

1932  *Equipment  Trust  certificates  . Various  $426,900 

U.  S.  Government  loan  (Treasury)  -  6%  2,560,000 

Total  in  1932  .  $2,986,900 

1933  *Equipment  Trust  certificates  . Various  $426,900 

New  Haven  &  Centerville  Street  Railway  5 %  283,000 

U.  S.  Government  loan  (Treasury)  -  6%  4,360,000 

Total  in  1933  .  $5,069,900 

•Includes  $98,900  due  U.  S.  Government  (Director  General). 


73 


Year  Name  of  Security 

1934  *Equipment  Trust  certificates  . 


Interest  Principal 


Rate  Amount 
Various  $426,900 


U.  S.  Government  loan  (Treasury)  _ 


6%  160,000 


Total  in  1934  . 

1935  *  Equipment  Trust  certificates  . Various  $426,900 

U.  S.  Government  loan  (Treasury)  _  6%  8,290,000 


$586,900 


Total  in  1935 


$8,716,900 


Total  12  years — •  1924  to  1935,  inclusive 


$127,824,201 


“Includes  $98,900  due  U.  S.  Government  (Director  General). 

It  will  be  noted  that  during  the  two  years,  1924  and 
1925  alone,  there  will  mature  $33,073,051  of  debt.  Of 
this  amount  $4,490,000  are  maturing  obligations  to 
the  IT.  S.  Government  and  $28,583,051  are  obligations 
due  others. 

In  addition  the  Company  will  have  to  make  arrange¬ 
ments  to  pay  off  or  refund,  during  the  next  12  years, 
$12,819,505  obligations  of  leased  lines  and  subsidiary 
corporations  (including  trolley  properties).  Of  this 
$12,819,505,  $8,598,000  are  Old  Colony  R.R.  4%  bonds 
maturing  in  1924  and  1925. 

Restoration  of  New  Haven’s  Credit  Imperative 

It  is  evident  that  the  financial  credit  of  the  New 
Haven  must  be  restored  within  the  next  18  months 
(or  before  the  year  1925)  in  order  to  put  it  in  a  posi¬ 
tion  to  borrow  money  at  reasonable  rates  to  take  care 
of  $33,000,000  of  debt  maturing  within  the  years  1924 
and  1925. 


74 


BOSTON  &  MAINE  RAILROAD 

General  Description 

The  Boston  &  Maine  system  comprises  2,515  miles 
(Map  8).  It  has  1,819  passenger  cars,  20,546  freight 
cars  and  1,134  locomotives.  It  produced  during  the 
year  1922,  863,856,000  passenger  miles  and  2,801,938,000 
revenue  ton  miles.  Of  the  passenger  cars  43  are 
steel,  679  are  steel  underframe  and  1,097  wooden.  The 
Boston  &  Maine  has  been  gradually  evolved  from  the 
consolidation  of  160  or  more  small  roads.  The  last 
important  consolidation  was  the  lease  in  1901  of  the 
Fitchburg  railroad.  In  1919  in  connection  with  the 
receivership,  the  Fitchburg  Railroad,  Boston  &  Lowell, 
Connecticut  River,  and  Concord  &  Montreal  became  an 
integral  part  of  the  system  by  the  exchange  of  the 
Boston  &  Maine  first  preferred  stock  for  the  guaran¬ 
teed  stocks  of  these  roads.  Since  1901,  the  system  as 
an  operating  unit  has  comprised  substantially  the  pres¬ 
ent  mileage. 

The  main  line  of  the  Fitchburg  extends  from  Boston 
to  Mechanic ville,  New  York,  a  distance  of  187  miles, 
where  it  connects  with  the  Delaware  &  Hudson.  Here 
the  company’s  big  western  classification  yard  is  located. 
It  then  has  an  extension  west  for  22  miles  to  Rotterdam 
Junction  where  it  connects  with  the  main  lines  of  the 
New  York  Central  and  West  Shore  in  the  Mohawk 
Valley.  In  addition  it  has  an  extension  from  Johnson- 
ville  to  Troy,  a  distance  of  16  miles,  the  distance  from 
Boston  to  Troy  being  190  miles.  The  Boston  &  Maine, 


75 


like  the  Boston  &  Albany,  has  two  heavy  grades,  though 
less  in  altitude  by  130  and  220  feet  respectively.  The 
distance  from  Boston  to  the  Hudson  River  is  13  miles 
less  than  by  the  Boston  &  Albany.  The  line  carries  a 
very  heavy  freight  traffic,  but  practically  no  through 
passenger  business,  these  trains  having  been  taken  off 
during  Federal  management,  though  a  through  sleeper 
to  Buffalo  has  just  been  restored. 

The  system  has  two  important  lines  running  from 
Boston  to  Portland,  the  old  Boston  &  Maine  line  and 
the  old  Eastern,  carrying  quite  a  heavy  passenger 
traffic,  especially  during  the  summer,  and  also  con¬ 
siderable  freight.  An  important  line  extends  north 
from  Boston  through  Lowell  to  Concord,  New  Hamp¬ 
shire,  from  where  the  line  continuing  north  for  197 
miles  reaches  a  connection  with  the  Canadian  Pacific 
at  Newport,  Vermont.  From  this  line  at  Concord  a 
branch  running  northwest  reaches  the  Connecticut  Val¬ 
ley  at  White  River  Junction,  where  it  connects  with  the 
Central  Vermont,  part  of  the  Grand  Trunk  system. 
The  Boston  and  Maine  has  other  lines  of  lesser  im¬ 
portance  and  numerous  branches.  It  serves  the  north¬ 
ern  half  of  Massachusetts,  practically  the  entire  State 
of  New  Hampshire,  sections  of  Vermont,  and  is  the 
only  outlet  for  the  State  of  Maine  except  via  the  Grand 
Trunk  or  Canadian  Pacific  through  Canada. 

Physical  Condition 

In  general  the  road  is  in  fair  physical  condition, 
adequate  for  the  traffic  offered.  It  is  obvious  outlay 
must  bear  some  relation  to  traffic.  A  branch  line,  for 


76 


example,  with  traffic  inadequate  to  pay  operating  ex¬ 
penses  must  be  accorded  the  minimum  outlay  of  capital 
and  only  enough  upkeep  to  secure  safety. 

A  substantial  handicap  is  found  in  the  light  bridges 
on  the  Fitchburg  Division,  east  of  the  Connecticut, 
which  are  not  stout  enough  to  carry  the  heavy  Santa 
Fe  engines  used  west  of  the  Connecticut.  They  can  be 
strengthened  for  about  $125,000,  completely  renewed 
for  $500,000. 

The  line  from  Concord,  connecting  with  the  Central 
Vermont  at  White  River  Junction,  should  have  the 
bridges  strengthened  to  carry  more  powerful  locomo¬ 
tives,  and  the  passing  tracks  should  be  lengthened  to 
care  for  longer  trains.  Probably  $700,000  ought  to  be 
expended  on  this  line.  At  the  present  time  the  road, 
we  understand,  has  under  order  ten  Santa  Fe  engines, 
and  when  the  bridges  on  the  Fitchburg  Division,  east 
of  the  Connecticut  River,  have  been  strengthened  some 
of  the  consolidation  engines,  now  in  use  on  the  Fitch¬ 
burg  Division,  can  replace  the  light  engines  now  in 
service  between  Concord  and  White  River  Junction. 

The  limited  dimensions  of  the  Hoosac  Tunnel  pre¬ 
vent  hauling  through  it  the  largest  furniture  and 
automobile  cars.  This  is  not  of  great  consequence  at 
present,  but  will  be  the  cause  of  increasing  embarrass¬ 
ment.  More  third  track  on  the  heavy  grades  of  the 
Fitchburg  Division  would  assist  in  the  movement  of 
freight  trains,  but  it  can  be  put  in  gradually  from  year 
to  vear. 

A  large  number  of  wooden  passenger  cars  should  be 
replaced  with  steel  as  soon  as  possible.  This  will  in¬ 
volve  a  substantial  outlay  as  steel  passenger  cars  at 


77 

present  prices  cost  from  twenty  to  twenty-five  thousand 
dollars  per  car. 

Boston  Freight  Terminals 

The  present  Boston  freight  terminals  are  inadequate 
and  expensive  to  operate.  They  consist  of  the  four 
small  freight  yards  of  the  old  Boston  &  Maine,  Eastern, 
Boston  &  Lowell  and  Fitchburg  railroads.  It  is  im¬ 
portant  that  a  modern  unified  yard  should  be  created 
as  soon  as  possible  in  the  interest  of  economy  and  good 
service.  This  would  involve  probably  several  million 
dollars.  Apparently,  the  purchase  of  little  new  land 
would  be  required.  The  Grand  Junction  Railway,  run¬ 
ning  from  Cottage  Farm  around  the  northerly  side  of 
the  city  to  East  Boston  and  belonging  to  the  Boston  & 
Albany  railroad,  cuts  across  the  Boston  &  Maine  yards 
and  hampers  efficient  operation.  These  tracks  prob¬ 
ably  should  be  elevated. 

Shops  and  Roundhouses 

The  company  has  large  and  comparatively  new  loco¬ 
motive  and  car  shops  at  Billerica.  The  lesser  shops 
on  the  line  require  only  gradual  strengthening  from 
year  to  year.  The  big  engine  roundhouses  and  at¬ 
tendant  repair  facilities  at  Mechanicville,  East  Deer¬ 
field  and  Concord,  N.H.,  are  well  adapted  to  the  needs 
of  the  road.  The  Boston  roundhouse  facilities  are  in¬ 
adequate  and  should  be  taken  in  hand  as  soon  as 
possible. 

Apart  from  the  new  steel  passenger  cars  and  the 
antiquated  Boston  freight  terminals,  the  Boston  & 
Maine  requires  only  a  limited  amount  of  immediate 


78 


capital  expenditure  to  put  the  system  into  reasonable 
condition  to  care  for  its  present  traffic. 


Operation 

We  have  already  referred  in  our  discussion  of  the 
New  Haven  to  various  operating  factors  of  the  Boston 
&  Maine. 


Car  Miles  per  Car  Bay 

We  give  again  for  the  purpose  of  studying  the  per¬ 
formance  of  the  Boston  &  Maine  the  average  freight 
car  miles  per  day  for  the  year  ending  June  30,  1922, 
for  all  the  New  England  roads,  for  all  cars,  and  in  a 
parallel  column  for  serviceable  cars  (bad  order  cars 
excluded) . 

Average  Car  Miles 


Average  Car  Miles  Per  Freight  Car  Day 
Per  Freight  Car  Day  ( Bad  Order  Cars 


(all  cars) 

Excluded) 

Boston  &  Albany . 

_  27.8 

30.0 

Atlantic  &  St.  Lawrence  . . . . 

_  21.8 

23.3 

Central  Vermont  . 

.  19.3 

29.5 

Maine  Central . 

_  17.8 

21.2 

Rutland . 

.  17.7 

23.6 

Boston  &  Maine  . 

.  17.1 

21.2 

Bangor  &  Aroostook . 

.  13.8 

19.3 

New  Haven  . 

.  13.6 

18.1 

The  Boston  &  Maine,  although  much  below  the  Bos¬ 
ton  &  Albany,  exceeded  the  New  Haven’s  performance, 
but  we  believe  that  there  is  room  for  improvement,  es¬ 
pecially  in  the  movement  of  cars  in  its  classification 
yards. 


79 


Car  Delays  in  Yards  at  Mechanicville,  Rotterdam 
Junction,  East  Deerfield  and  Ayer 

The  lack  of  prompt  despatch  of  cars  at  the  Rotter¬ 
dam  J unction,  Mechanicville,  East  Deerfield  and 
Ayer  Yards  seems  to  us  quite  unreasonable.  At  Me¬ 
chanicville,  a  large  modern  “hump”  classification 
yard  was  installed  while  the  Boston  &  Maine  was  un¬ 
der  the  active  control  of  the  New  Haven  railroad. 
This  yard  corresponds  to  the  Maybrook  hump  yard  at 
the  western  end  of  the  New  Haven  system.  The  aver¬ 
age  daily  number  of  cars  classified  at  Mechanicville 
is  595  eastbound.  Practically  none  of  the  cars  west¬ 
bound  are  classified.  Eor  the  year  ending  June  30, 
1922,  the  daily  average  delay  for  an  eastbound  car 
classified  at  Mechanicville  was  25  hours.  This  is  a 
poorer  showing  than  the  daily  average  at  the  three  big 
hump  yards  of  the  New  Haven  system : — 

Year  Ending 
June  30, 1922 

Mechanicville  .  25.1  hours 

Maybrook  .  13.4  “ 

New  Haven  (Cedar  Hill)  . .  13.2  “ 

Providence  .  14.8  “ 

For  the  six  months  ending  December  31,  1922,  the 
daily  average  delay  at  Mechanicville  was  30.1  hours; 
comparison  with  the  New  Haven  shows  the  following: 

6  months  ending 
Dec.  31, 1922 

Mechanicville  .  30.1  hours 

Maybrook  .  38.2  “ 

New  Haven  (Cedar  Hill)  . .  21.6  “ 

Providence  .  19.7  “ 


80 


The  Boston  &  Maine  receives  directly  into  its  Me- 
chanicville  yard  from  the  Delaware  &  Hudson  rail¬ 
road  a  movement  which  during  the  twelve  months 
ending  J une  30,  1922,  averaged  432  cars  per  day. 

But  this  is  not  the  whole  story.  The  Boston  &  Maine 
during  the  12  months  ending  June  30,  1922,  received 
an  average  of  226  cars  from  the  New  York  Central  at 
Rotterdam  Junction.  The  cars  entered  the  Rotter¬ 
dam  Junction  yard  but  practically  no  classification 
was  carried  on  there.  These  cars  were  pulled  for  classi¬ 
fication  22  miles  further  to  the  Mechanicville  yard, 
yet  the  daily  average  detention  in  the  Rotterdam  yard 
of  these  eastbound  cars  coming  off  of  the  New  York 
Central  and  West  Shore  roads  in  trains  and  simply 
awaiting  further  movement  to  the  Mechanicville 
classification  yard  was  11.1  hours  for  the  year  ending 
June  30,  1922,  and  14.0  hours  for  the  6  months  ending 
December  31,  1922.  This  means  that  the  average  car 
coming  off  the  New  York  Central  system  at  Rotterdam 
Junction  was  first  delayed  11.1  hours  at  Rotterdam 
Junction  and  then  at  the  Mechanicville  yard,  22  miles 
further  on,  25.0  more  hours,  a  total  delay  of  36.1  hours 
at  the  western  end  of  the  system  for  each  car  coming 
off  the  West  Shore  or  New  York  Central  road  before 
the  car  moves  out  of  Mechanicville  for  its  first  regu¬ 
lar  engine  run  of  84  miles  to  East  Deerfield. 

At  East  Deerfield  the  daily  average  for  the  year  end¬ 
ing  June  30,  1922  was  10.7  hours,  and  for  the  6  months 

ending  December  31,  1922,  18.2  hours.  (Eastbound 

\ 

movement  only.) 

During  the  year  ending  June  30,  1922,  an  average 
of  653  cars  moved  further  east  out  of  the  East  Deer- 


81 


field  yard,  and  during  the  6  months  ending  December 
31,  1922,  580  cars  a  day.  A  large  proportion  of  these 
cars  moving  east  out  of  Deerfield  go  into  the  classifica¬ 
tion  yard  at  Ayer,  where  there  was  a  daily  average  de¬ 
tention  for  the  year  ending  June  30, 1922,  of  18.2  hours, 
and  for  the  6  months  ending  December  31,  1922,  24.0 
hours.  Ayer  classified  during  the  year  ending  June 
30,  1922,  a  daily  average  of  339  cars,  and  for  the  6 
months  ending  December  31,  1922,  344  cars.  (East 
bound  only.)  We  show  in  the  form  of  a  diagram,  the 
time  consumed  by  the  average  car  coming  oft  the  New 
York  Central  or  West  Shore  road  at  Rotterdam  Junc¬ 
tion  and  moving  to  a  point  east  of  Ayer. 


Car  Movement 

Rotterdam  Junction  to  Boston 
Present  Car  Movement. 


In  Yards  In  Yards 

at  at 

Rotterdam  Mechanic- 

Junction  ville 


In  Yards 
at 

East 

Deerfield 


In  Yards 
at 

Ayer 


Point 

East 


11.1 hrs.  2  hrs.  25.0  hrs.  7  hrs.  10.7  hrs.  6  hrs.  18.2  hrs.  3  hrs. 

In  transit  In  transit  In  transit  In  transit 

22  miles  85  miles  67  miles  36  miles 


Possible  Car  Movement 


Total  Present  time  =  83  hours 


Rotterdam  Mechanic-  East 

Junction  ville  Deerfield 


Point 
Ayer  East 


6  hrs.  2  9  hrs.  7  hrs.  9  hrs.  6  hrs.  9  hrs.  3  hrs. 

hrs. 


Total  Possible  time  =51  hours 


Possible  Reduction  in  Delay  32  hours 


82 


Erom  the  Ayer  yard  some  of  the  cars  move  to  Boston. 
Many  go  north  by  the  old  Stony  Brook  railroad 
destined  for  Lowell  or  beyond  to  Portland,  or  points 
on  the  Maine  Central  system  or  on  the  Bangor  & 
Aroostook. 


Cars  Moved  Daily 

Another  measure  of  effective  operation  for  which 
figures  have  been  compiled  from  the  records  of  the 
respective  railroads  is  the  percentage  of  cars  moved 
each  day  compared  with  the  number  ready  and  waiting 
to  be  moved. 

Cars  standing  upon  the  tracks  of  the  railroad  on  any 
one  day  may  be  classified  as  coming  under  one  of  the 
following  heads : 

Cars  under  load  at  stations  or  terminals  to  be 
unloaded. 

Cars  at  stations  or  terminals  being  loaded. 

Empty  cars  awaiting  loading  orders. 

Bad  order  cars. 

Stored  cars. 

Cars  ready  for  movement. 

The  last  named  cars  are  in  service  ready  to  be  moved. 
The  average  cars  moved,  out  of  all  ready  to  be  moved 
as  reported  by  51  representative  railroads  outside  of 
New  England  for  the  year  ending  June  30,  1922,  was 
74.0  per  cent.  Any  percentage  moved  below  that  is  be¬ 
low  the  average  efficiency  of  the  United  States,  and 
any  percentage  above  is  above  the  average  efficiency. 

Applying  this  test  to  the  Boston  &  Maine  railroad, 
we  find  that  for  the  twelve  months  ending  June  30, 
1922,  the  average  percentage  of  cars  actually  moved 


83 


daily  of  the  total  ready  to  be  moved  was  61.5  per  cent, 
and  for  the  six  months  ending  December  31,  1922,  was 
56.2  per  cent,  and  for  all  New  England  railroads  as 
follows : 


Year  Ending1 

6  months  ending 

June  30, 1922 

Dec.  31, 1922 

Boston  &  Albany . 

80.3  percent 

77.2 

per  cent 

Rutland  . 

78.4  “ 

n 

80.0 

a  a 

Maine  Central  . 

76.6  “ 

n 

71.7 

a  a 

Central  Vermont  . 

76.1  4  4 

tt 

69.9 

a  a 

Bangor  &  Aroostook . 

75.8  44 

tt 

75.8 

a  a 

New  Haven . 

69.2  44 

i  t 

58.7 

a  a 

Boston  &  Maine . 

61.5  44 

i  i 

56.2 

a  a 

Atlantic  &  St.  Lawrence  . . 

58.3  44 

tt 

63.1 

a  a 

If  the  Boston  &  Maine  had  attained  the  74.0  per  cent 
of  the  51  important  railroads  mentioned  above,  there 
would  have  been  left  over  daily  an  average  of  3,119  cars 
in  place  of  the  5,548  actually  left  standing,  or  a  daily 
saving  in  car  days  of  2,429. 

This  converted  into  one  year’s  performance  repre¬ 
sents  a  saving  of  $886,585.00. 

Embaego  Policy  of  Boston  &  Maine 

In  the  case  of  the  Boston  &  Maine  system,  as  in  the 
case  of  the  New  Haven,  there  is  a  point  in  the  accumu¬ 
lation  of  cars  on  the  system  where  more  cars  mean 
rapidly  mounting  adverse  per  diems  and  few  or  no  more 
ton  miles  manufactured.  Indeed  the  jam  can  easily 
be  carried  to  the  point  where  the  ton  miles  produced 
are  seriously  cut  down. 

We  give  the  average  number  of  cars  on  the  system 
during  1922  and  the  first  four  months  of  1923,  and  also 


84 


the  average  car  miles  per  car  day : 


Car  Miles 

Number 

Daily  Average 

Per  Car  Day 

Bad 

Cars  on  line 

(all  cars) 

Order  Cars 

January  . 

.  30,211 

15.1 

5,934 

February  . 

. .  31,675 

17.1 

5,906 

March  . 

.  31,677 

18.7 

5,818 

April  . 

.  30,054 

16.9 

5,642 

May  . 

.  30,466 

17.1 

5,599 

June  . 

.  31,045 

16.8 

5,659 

July  . 

.  29,772 

16.2 

5,153 

August  . 

.  29,972 

16.8 

5,645 

September  . 

.  32,000 

17.5 

5,259 

October  . 

.  34,811 

18.5 

4,748 

November  . 

.  36,833 

17.7 

4,499 

December  . 

.  36,663 

15.1 

4,234 

January  . 

.  39,324 

11.4 

8,976 

February  . 

.  41,469 

11.1 

3,956 

March  . 

.  41,538 

13.8 

3,952 

April  . 

.  41,079 

16.6 

3,795 

We  believe  the  Boston  &  Maine  would  have  been 
much  better  oft  if  it  had  limited  the  cars  on  its  system 
during  these  last  eight  months  to  32,000.  Perhaps  in 
summer,  when  weather  conditions  are  favorable,  and 
if  other  conditions  are  also  favorable,  the  road  can 
maintain  a  satisfactory  daily  car  movement  with  a 
larger  number  on  the  line,  but,  with  a  strike  on  its 
hands  and  winter  weather  coming  on,  we  think  it  would 
have  been  much  better  policy  and  would  have  saved  a 
large  sum  of  money,  and  would  have  resulted  in 
just  about  as  many  ton  miles  for  the  system  if  it 
had  kept  the  number  down  to  32,000.  The  Boston 
&  Maine  uses  the  straight  embargo  method  as  con¬ 
trasted  with  the  New  Haven  permit  system;  in 
other  words,  under  the  Boston  &  Maine  plan  if  the 
road  is  in  danger  of  being  blocked  an  embargo  with 
certain  specified  exceptions  is  put  on,  it  may  be  only 
for  a  few  days,  then  taken  off,  and  then  again  restored, 


85 


according  to  the  number  of  cars  on  the  system  and  the 
number  reported  moving  towards  the  system. 

In  the  month  of  September  the  road  averaged  32,000 
cars  on  the  line,  and  the  daily  average  movement  was 
17.5  miles.  During  October  the  number  rose  to  an 
average  of  34,811,  meaning  probably  about  33,000  at 
the  beginning  of  the  month  and  probably  close  to 
36,000  at  the  end  of  the  month.  The  daily  distance 
per  car  went  up  to  18.5  miles.  This  was  a  good  spurt, 
and  represented  hard  work  by  all  hands  to  move  the 
traffic  and  keep  the  road  clear,  but  the  condition  of  the 
locomotives  was  poor  and  winter  coming  on.  In  No¬ 
vember  the  number  of  cars  on  the  line  was  allowed  to 
rise  substantially  further  to  an  average  of  36,833,  and 
the  average  daily  movement  per  car  dropped  to  17.7. 
In  December  the  number  of  cars  on  the  line  was  about 
the  same,  and  the  daily  movement  dropped  to  15.1.  In 
January,  February  and  March,  1923,  as  will  be  seen 
from  the  preceding  table,  the  number  of  cars  on  the 
line  averaged  considerably  over  40,000,  and  the  daily 
distance  dropped  to  11.4  for  January,  11.1  for  Febru¬ 
ary,  and  13.8  for  March.  In  April,  with  an  average  of 
41,079  cars  on  the  line,  the  road  did  well  to  maintain 
an  average  daily  car  travel  of  16.6,  but  still  in  our 
judgment,  in  April,  in  spite  of  more  favorable  operat¬ 
ing  conditions,  the  road  was  attempting  to  carry  a  load 
beyond  its  strength,  and  April  net  earnings  were  cor¬ 
respondingly  affected. 

If  the  number  of  cars  on  the  system  had  been  kept 
down  to  32,000  from  October  1st  to  May  1st,  the  sav¬ 
ing  in  per  diems  would  have  aggregated  $1,436,908  in 
the  seven  months  ’  period. 


86 


If  kept  down  to  33,000  cars  tlie  saying  would  have 
been  $1,224,908.  The  following  table  shows  the  saving 
by  months  on  the  basis  of  32,000  cars  on  line : 


1923  — 


1922 


Cars  on  Line 

Adverse  Car 
Per  Diems 

Decrease  in 
Adverse  Car  per  Diems 
if  Cars  had  been  kept 
down  to  32,000  cars 

January  .  . 

. . . .  30,211 

$327,398 

February  . 

....  31,675 

349,171 

March  . . . 

....  31,677 

392,049 

April  . . . . 

....  30,054 

309,076 

May  . 

....  30,466 

330,810 

334,408 

June  . 

....  31,045 

July  . 

....  29,772 

330,543 

August  . . . 

_  29,972 

369,359 

September 

....  32,000 

443,212 

October  . . 

....  34,811 

576,000 

$87,141 

November 

....  36,833 

647,444 

144,990 

December 

....  36,663 

652,970 

144,553 

Total  12  months  ... 

$5,062,440 

$376,684 

J anuary  . . . 

....  39,324 

$727,221 

$227,044 

February  . 

. . . .  41,469 

730,727 

265,132 

March  . . . 

. . . .  41,538 

831,172 

295,678 

April . 

....  41,079 

796,222 

272,370 

Total  16  months  . . . 

$8,147,782 

$1,436,908 

As  we  pointed  out  in  considering  the  New  Haven 
Railroad  the  car  per  diems  received  by  the  Boston  & 
Maine  system  for  the  use  of  its  cars  on  other  systems 
constitutes  no  compensation  to  be  balanced  against 

this  outgo.  The  car  per  diems  received  from  other 
roads  merely  represents  upkeep,  depreciation,  and  a 
return  upon  the  capital  invested  in  the  cars  which  these 
other  roads  are  using. 


87 

The  Boston  &  Maine  car  per  diems  receivable  for  the 


same  period  were : 

Per  Diems 
Receivable 

1922  —  January  .  $106,232 

February  .  98,499 

March .  113,889 

April  .  108,140 

May  .  111,688 

June  .  103,882 

July  .  L25,385 

August  .  152,362 

September  .  168,541 

October . 195,162 

November  .  212,896 

December  . 227,332 


Total  12  months  . $1,724,008 

1923  —  January  .  $228,081 

February  .  206,197 

March  . .  238,141 

April .  240,210 


Total  16  months  . $2,636,637 


Materials  and  Supplies 


Condensed  Inventory 

Dec.  31  Months’  Dec.  31  Months’  Dec.  31  Months’ 
1920  Supply  1921  Supply  1922  Supply 

Coal  . $2,836,844  2.1  $1,562,499  1.4  $1,210,173  1.3 

Rails  .  600,253  9.2  899,837  7.4  669,706  14.1 

Ties  .  637,770  6.4  1,196,022  6.3  673,715  4.5 

Lumber  .  1,330,763  8.5  570,196  3.2  497,849  5.0 


AU  other  stores  7,305,268  8.5  5,696,857  7.5  4,755,714  6.7 


Total  Inventory  $12,710,898  $9,925,411  $7,807,157 


88 


Total  materials  and  supplies  on  hand  December  31, 
1920,  were  excessive  and  the  unnecessary  surplus  was 
costing  the  road  about  $325,000  a  year,  but  the  surplus 
has  been  well  pulled  down  during  the  last  two  years 
and  the  inventory  on  December  31,  1922,  stood  at  a 
reasonable  figure. 

Locomotive  Repairs 

In  our  discussion  of  the  New  Haven  we  have  already 
shown  the  comparative  costs  of  locomotive  repairs  in 
considerable  detail  for  all  the  New  England  roads,  and 
we  have  noted  that  the  cost  per  locomotive  mile  in  the 
year  1921  on  the  Boston  &  Maine  was  30.7  cents,  as 
compared  with  35  cents  on  the  New  Haven,  23.5  cents 
on  the  Boston  &  Albany,  and  22  cents  on  the  Maine 
Central. 

If  comparison  should  be  made  of  the  cost  of  repairs 
on  the  Boston  &  Maine  with  the  cost  on  the  Maine  Cen¬ 
tal,  consideration  should  be  given  to  the  fact  that  the 
Maine  Central  locomotives  average  15.6  years  of  age,  as 
compared  with  17.4  years  on  the  Boston  &  Maine.  On 
the  other  hand,  the  Maine  Central  locomotives  are  about 
10  per  cent  heavier  than  the  Boston  &  Maine  locomo¬ 
tives.  The  Maine  Central  was  able  to  maintain  its  loco¬ 
motives  in  better  condition  than  those  of  the  Boston  & 
Maine  for  a  smaller  expenditure  per  locomotive,  and  at 
the  same  time  obtain  greater  mileage  per  locomotive. 
The  net  result  was  a  cost  per  locomotive  mile  of  22 
cents,  compared  with  30.7  cents  on  the  Boston  &  Maine. 
This  wide  difference  in  cost  indicates  the  necessity  for 
careful  attention  on  the  part  of  the  Boston  &  Maine 
operating  officials  to  the  possibilities  of  materially  re- 


ducing  tlieir  costs  on  this  large  and  important  item  of 
expense. 


Density 

Examination  of  the  train  movement  on  this  system 
shows  that  the  only  portion  where  the  density  of  train 
movement  is  approaching  capacity  is  on  the  main  line 
of  the  Fitchburg  between  South  Ashburnham  and 
Boston  where,  however,  there  still  remains  capacity 
for  a  25  per  cent  increase.  Between  Ayer  and  Lowell 
for  a  portion  of  the  distance  there  is  only  a  single 
track  for  about  9  miles.  This  in  summer  sometimes 
carries  a  train  density  practically  up  to  capacity. 

Between  South  Ashburnham  and  Mechanicville, 
there  is  easily  room  for  40  per  cent  increase  over  and 
above  the  density  shown  by  the  train  reports  for  April 
and  September,  1922. 

In  the  suburban  territory  immediately  surrounding 
Boston  the  traffic  upon  some  sections,  particularly  in 
respect  to  suburban  passenger  trains,  is  heavy,  and  the 
train  density  has  reached  a  point  where  consideration 
must  be  given  before  long  to  additional  track  facilities. 


90 


% 

FINANCIAL  CONDITION 

Earnings 

The  income  account  of  the  Boston  &  Maine  railroad 
for  each  of  the  151/2  years  from  June  30,  1907  to  De¬ 
cember  31,  1922,  is  given  in  Exhibit  B  on  the  opposite 
page.  This  statement  shows  that  the  company’s  net 
railway  operating  income  (column  10)  as  well  as  its 
net  income  after  fixed  charges  (column  18)  reached 
the  peak  in  the  year  ending  December  31,  1916.  The 
years  1918,  1919  and  1920  include  the  periods  of  gov¬ 
ernment  control  and  government  guaranties,  and  are 
therefore  not  properly  comparable  with  other  years. 
The  fact  that  the  company’s  fixed  charges  were  reduced 
by  $2,725,862  through  the  reorganization  and  consoli¬ 
dation  on  December  1,  1919  should  also  be  taken  into 
account  in  comparison  with  the  years  preceding. 

Growth  of  Traffic 

A  study  of  the  traffic  statistics  of  the  Boston  & 
Maine  shows  that  the  growth  of  the  Company’s  freight 
business,  between  1912  and  1922,  has  been  relatively 
small  as  compared  with  the  growth  for  the  entire  East¬ 
ern  District  and  for  the  entire  TTnited  States.*  It  will 
also  be  noted  that  the  number  of  passengers  carried  was 
6.1  per  cent  less  in  1922  than  in  1912.  While  there  has 
been  an  encouraging  gain  in  both  freight  and  passen¬ 
ger  business  during  the  first  four  months  of  1923,  the 
normal  annual  increase  in  traffic  on  the  Boston  &  Maine 
will  probably  continue  to  be  comparatively  small.  This 
is  chiefly  because  a  large  part  of  the  road’s  mileage 

*  Appendix  J.  Revenue  Ton  Miles  and  Passenger  Miles,  Boston  &  Maine 
Railroad  1903-1922  (chart),  and  Appendix  K.  Volume  of  Freight  and  Pas¬ 
senger  Traffic,  Revenues  and  Rates,  Boston  &  Maine,  1912-1922. 


EXHIBIT  B 


BOSTON  &  MAINE  RAILROAD  CONDENSED  INCOME  ACCOUNT 

1908  TO  1922 


Year 
Ending 
June  30 


i  1908 

1909 

1910 

1911 

1912 

1913 

1914 

1915 

1916 

Year  Ending 
Dec.  31 

1916 

1917 

1918  A 


1919 

1920 

1921 

1922 


1 

Railway 

Operating 

Revenues 


839,445,444 

39,999,622 

43,849,191 

45,363,663 

46,630,746 

49,241,948 


Railway 

Operating 

Expenses 


Percent 
Expenses 
to 

Revenues 


$29,361,115 

28,651,365 

31,781,080 

35,629,046 
35,584,254 
3S, 641, 952 


48,155,179  38,851,712 

46,673,049  35,909,772 

52,075,428  36,197,959 


55,3S3,544 

59,450,779 

70,157,584 

72,935,146 

86,652,745 

78,477,418 

79,800,123 


38,251,715 

47,164,940 

64,779,651 

67,144,063 

90,989,432 

73,15S,8S5 

67,054,397 


74.43 

71.63 

72.48 

78.54 

76.31 

78.47 

80.68 

76.94 

69.51 


69.07 

79.33 

92.33 

92.06 

105.00 

93.22 

84.03 


3 

Railway 

Net 

Operating 

Revenues 


$10,084,329 

11,348,257 

12,06S,111 

9,734,617 

11,046,492 

10,599,996 

9,303,467 

10,763,277 

15,877,469 


17,131,829 

12.2S5.839 

5,377,933 

5,791,083 

-4,336,687 

5,318,533 

12,745,726 


Taxes 


Uncollec¬ 

tible 

Railway 

Revenues 


$1,712,272 
1,789,933 
2,076, S80 

2,OS9,905 

2,0S6,864 

2,025,629 

2,059,017 

1,978,223 

1,986,267 


2,091,089 

2,156,650 

2,317,524 

3,043,387 

3,001,OS7 

2,728,224 

2,580,677 


6 

Hire  of 
Freight 
Cars 
(Net) 


7 

Other 
Equipment 
Rents 
(Net) 


$5,944 

2,624 


3,769 

3,791 

124 

1,062 

48,126 

7,281 

5,094 


§1,303,744 

649,279 

763,884 

888,655 

1,078,561 

1,817,232 

1,583,774 

1,196,325 

2,074,248 


2,561,723 

2,954,175 

1,526,911 

877,363 

4,416,809 

3,178,427 

3,740,974 


-SIS, 987 
-33,856 

-11,214 

-40,074 

-14,666 

-68,917 

-48,370 

-10,823 

-20,309 


-34,871 

-21,038 

-47,618 

-97,620 

-10,237 

-117,744 

-18,350 


8 

Joint 

Facility 

Rents 

(Net) 


-SI  0,392 
-26,360 
-24,206 

-24,684 

89,635 

74,933 

68,905 

82,645 

54,866 


65,737 

50,038 

77,698 

217,591 

125,748 

110,713 

-38,409 


9 

Total 
Taxes  and 
Rents 
(Cols.  4  to  8) 


$2,986,637 

2,389,996 

2,805,345 

2,913,S02 

3,240,494 

3,848,877 

3,663,326 

3,252,314 

4,097,696 


4,687,447 

5,143,616 

3,S74,739 

4,041,783 

7,581,533 

5,906,901 

6,269,986 


10 

Net 

Railway 

Operating 

Income 


Percent 
Column  10 
to 

Column  1 


$7,097,692 

8,958,261 

9,262,766 

6,820,815 

7,805,998 

6,751,119 

5,640,141 

7,510,963 

11,779,773 


12,444,3S2 

7,142,223 

1,503,194A 

1,749, 300A 
-11,918,220k 
-588,368 

6,475,740 


17.99 

22.26 

21.12 

15.04 

16.74 

13.71 

11.71 

16.09 

22.62 


22.47 

12.02 

2.14 

2.40 

Def. 

Def. 

8.11 


11 

Non- 

Operating 

Income 


12 

Government 

Guarantee 

Adjusted 


$642,213 

570,314 

673,017 

788,453 

779,079 

1,316,773 

1,460,063 

833,685 

711,100 


747,018 

753,953 

486,436 

490,346 

803,795 

968,193 

797,209 


13 

Total  Income 
Available  for 
Fixed  Charges 
(Cols.  10,11,12) 


$6,355,562  B 

5,775,820  B 
17,9S9,554  B 


$7,739,905 

9,52S,575 

9,935,783 

7,609,268 

8,585,077 

8,067,892 

7,100,204 

8,344,648 

12,490,873 


13,191,400 

7,896,176 

8,345,192 

8,015,466 

6,875,129 

379,825 

7,272,949 


14 

Rent  for 
Leased 
Roads 


$5,183,515 

5,246,433 

5,265,498 

5,385,054 

5,176,879 

5,312,700 

5,4S7,629 

5,5S9,406 

5,626,029 


5,659,634 

5,695,962 

5,562,924 

928,550 

927,845 

923,180 

920,376 


15 

Interest 

ON 

Debt 


$1,769,905 

1,859,357 

1,783,910 

1,834,171 

2,083,703 

2,604,223 

3,572,778 

3,003,721 

2,700,045 


2,651,844 

2,523,024 

2,522,374 

4,428,307 

5,291,080 

6,033,428 

6,004,691 


16 

Other 

Deductions 


$6,204 

6,397 

6,969 

5,270 

5,462 

5,959 

10,700 

8,178 

17,104 


12,274 

11,467 

1,994 

1,086 

41,474 

35,639 


17 


Total  Fixed 
Charges 
(Cols.  14, 15, 16) 


18 

Net  Income 
Applicable 
to  Dividends 
(Cols.  13-17) 


$6,959,624 

7,112,187 

7,056,377 

7,224,495 

7,266,044 

7,922,882 

9,071,107 

8,601,305 

8,343,178 


8,323,752 

8,230,453 

8,087,292 

5,357,943 

6,260,399 

6,992,247 


319,890  C  7,244,957 


$780,281 

2,416,388 

2,879,406 

3S4,773 

1,319,033 

145,010 

-1,970,903 

-256,657 

4,147,695 


4,867,648 

-334,277 

257,900 

2,657,523 

614,730 

-6,612,422 

27,992 


19 

Dividends 

Paid 


$2,080,621 

1,817,361 

1,868,520 

1,958,971 

1,767,951 

1,374,138 


2,035,716 

1,227,948 


20 


Balance 

of 

Income 


-$1,300,340 

599,027 

1,010,886 

-1,574,198 

-448,918 

-1,229,128 

-1,970,903 

-266,657 

4,147,695 


4,867,648 

-334,277 

257,900 

621,807 

-613,218 

-6,612,422 

27,992 


Year 
Ending 
June  30 


1908 

1909 

1910 

1911 

1912 

1913 

1914 

1915 

1916 

Year  Ending 
Dec.  31 

1916 

1917 

1918 

1919 

1920 

1921 

1922 


-Italics  indicate 
Deficit 


-  Italics  indicate 
Credit 


-Italics  indicate 
Deficit 


-Italics  indicate 

Deficit 


-Italics  indicate 
Deficit 


This  Condensed  Income  Account  does  not  include  the  figures  for  the  following  small  lines  in  the  Boston  &  Maine 
System  for  which  complete  information  was  not  available  for  the  entire  period.  The  Railway  Operating  Revenues 
of  these  small  lines  in  1922  were  only  3%  of  the  Railway  Operating  Revenues  of  the  Boston  &  Maine  System. 

Vermont  Valley  York  Harbor  &  Beach 

Sullivan  County  Mount  Washington 

St.  Johnsbury  &  Lake  Champlain  Montpelier  &  Wells  River 

Barre  &  Chelsea 


A  —  Federal  and  Corporate  accounts  combined  for  cols.  1  to  10. 

B  —  Government  Guarantee  Adjusted  represents  the  difference  between  the  Net  Railway  Operating  Income  guar¬ 
anteed  by  the  Government  and  the  Net  Railway  Operating  Income  earned  by  the  United  States  Railroad 
Administration  during  Federal  control  and  by  the  corporation  during  the  Guaranty  Period  after  adjustment 
for  Revenues  and  Expenses  prior  to  January  1,  1918. 

C  —  Includes  $280,462  representing  net  of  Revenues  and  Expenses  prior  to  January  1,  1918,  due  U.  S.  Government 
leaving  a  balance  of  $39,428  of  ether  deductions  applicable  to  corporate  operation  in  1922. 


91 


is  in  the  states  of  Maine,  New  Hampshire  and  Ver¬ 
mont,  where  the  growth  in  population  and  business  has 
been  relatively  light  during  the  last  decade.  Unless 
a  much  larger  volume  of  interchange  business  or  ex¬ 
port  business  can  be  developed  through  the  northern 
gateways  via  Canada,  the  Boston  &  Maine  can  hardly 
hope  to  keep  pace  with  Southern  New  England,  or  with 
the  country  as  a  whole,  in  growth  of  traffic. 

Comparison  of  Results  of  1922  with  1916 

The  following  comparison  of  income  accounts  for  the 
year  ending  December  31, 1916,  with  the  year  1922,  gives 
a  significant  picture  of  the  decline  in  net  income,  and 
indicates  some  of  the  reasons  for  that  decline. 

Year  ending  Year  ending 

Dec.  31,1916  Dec.  31, 1922  Increase  Decrease 


Railway  Operating  Revenues  $55,383,544  $79,800,123  $24,416,579 
Railway  Operating  Expenses  38,251,715  67,054,397  28,802,682 


Railway  Net  Operating  Revenue  17,131,829 

12,745,726 

$4,386,103 

Taxes  and  Rents 

Taxes  . 

Equipment  Rentals  (net) .... 
Joint  Facility  Rents  (net)  Cr. 
Uncollectible  Railway  Revenues 

2,091,089 

2,526,852 

65,737 

3,769 

2,580,677 

3,722,624 

38,409 

5,094 

489,588 

1,195,772 

1,325 

104,146 

Total  Taxes  and  Rents . 

4,687,447 

6,269,986 

1,582,539 

Net  Railway  Operating  Income 
Non-operating  Income  . 

12,444,382 

747,018 

6,475,740 

797,209 

50,191 

5,968,642 

Total  Income  Applicable 
to  Fixed  Charges . 

13,191,400 

7,272,949 

5,918,451 

Fixed  Charges 

Rentals  of  Leased  Roads  .... 

Interest  on  Debt  . 

Other  Deductions  . 

5,659,634 

2,651,844 

12,274 

920,376 

6,004,691 

319,890 

3,352,847 

307,616 

4,739,258 

Total  Fixed  Charges . 

8,323,752 

7,244,957 

1,078,795 

Net  Income  after  Fixed  Charges 

4,867,648 

None 

27,992 

None 

4,839,656 

Balance  of  Income . 

$4,867,648 

$27,992 

$4,839,656 

92 


It  is  to  be  noted  that  in  spite  of  an  increase  in  Rail¬ 
way  Operating  Revenues  of  $24,416,579,  or  44  per  cent 
in  1922,  as  compared  with  1916,  Operating  Expenses  in¬ 
creased  $28,802,682,  so  that  there  wa^  a  decrease  of 
$4,386,103  in  Railway  Net  Operating  Revenue  in  1922, 
as  compared  with  1916.  The  increase  of  $1,195,772  in 
net  Equipment  Rentals  (chiefly  per  diem  charges  for 
use  of  freight  cars  of  other  roads)  is  also  an  important 
cause  of  the  relatively  poor  showing  in  1922.  The  in¬ 
crease  of  $489,588,  or  23.4  per  cent  in  Taxes  is  also  an 
important  factor.  The  decrease  of  $1,078,795  in  Fixed 
Charges  is  more  than  accounted  for  by  the  reduction  of 
$2,725,000  in  Fixed  Charges  effected  by  the  reorganiza¬ 
tion  in  1919.  The  difference  is  due  to  increase  in  in¬ 
terest-bearing  debt  incurred  for  additions  and  im¬ 
provements  since  1916. 

In  considering  the  above  comparison  it  must  not  be 
forgotten  that  the  year  ending  December  31,  1916,  was 
the  best  year  in  the  company’s  history,  both  as  regards 
net  earnings  and  as  regards  expense  ratios.  If  pres¬ 
ent  labor  costs,  rentals  of  equipment,  transportation 
rates,  and  divisions  of  freight  rates  on  business  inter¬ 
changed  with  western  connecting  lines,  remain  un¬ 
changed,  the  company  cannot  expect  to  equal  the 
record  of  1916  in  the  near  future. 


93 

Comparative  Expense  Ratios,  1908-1922 

Tlie  following  statement  shows  the  ratios  of  expenses 
to  total  railway  operating  revenue  each  year  from  1908 
to  1922,  inclusive: 


.Operating  Expenses _ — *  Total 


Transpor¬ 

tation 

Ex¬ 

penses 

Other 

Ex¬ 

penses 

Total 
Operat¬ 
ing  Ex¬ 
penses 

Taxes 

and 

Operating 
Expenses 
Taxes  and 
Rent 

Year 
ending 
June  30 

Way  & 
Struc¬ 
tures 

Equip¬ 

ment 

Total 

Mainte¬ 

nance 

Rents 

1908 

11.74 

11.09 

22.83 

47.49 

4.11 

74.43 

7.58 

82.01 

1909 

10.72 

11.88 

22.60 

44.86 

4.17 

71.63 

6.11 

77.74 

1910 

12.06 

12.48 

24.54 

43.85 

4.09 

72.48 

6.40 

78.88 

1911 

13.37 

13.77 

27.14 

46.80 

4.60 

78.54 

6.42 

84.96 

1912 

12.49 

13.75 

26.24 

45.71 

4.36 

76.31 

6.95 

83.26 

1913 

11.01 

15.78 

26.79 

46.90 

4.78 

78.47 

7.82 

86.29 

1914 

13.59 

16.06 

29.65 

46.08 

4.95 

80.68 

7.61 

88.29 

1915 

15.42 

14.34 

29.76 

43.23 

3.95 

76.94 

6.97 

83.91 

1916 

11.50 

12.65 

24.15 

41.75 

3.61 

69.51 

7.87 

77.38 

Calendar 

Year 

1916 

11.07 

12.80 

23.87 

41.69 

3.51 

69.07 

8.46 

77.53 

1917 

10.41 

14.78 

25.19 

50.39 

3.75 

79.33 

8.65 

87.92 

1918 

14.33 

20.28 

34.61 

53.62 

3.93 

92.16 

5.36 

97.58 

1919 

13.18 

20.96 

34.14 

52.70 

4.12 

90.96 

4.67 

95.63 

1920 

17.42 

23.27 

40.69 

59.26 

5.05 

105.00 

8.75 

113.75 

1921 

16.43 

20.30 

36.73 

51.50 

4.99 

93.22 

7.53 

100.75 

1922 

13.88 

20.19 

34.07 

45.67 

4.29 

84.03 

7.86 

9.S9 

Expenses  for  Maintenance  took  34.07  cents  out  of 
every  dollar  of  gross  revenue  in  1922,  as  compared  with 
23.87  cents  in  1916,  an  increase  of  about  10  cents,  of 
which  increase  about  three-fourths  was  in  Maintenance 
of  Equipment.  Transportation  Expenses  in  1922  took 
45.67  cents  out  of  every  dollar  of  gross  revenue  as  com¬ 
pared  with  41.69  cents  in  1916,  an  increase  of  about  4 
cents.  It  will  be  observed,  however,  that  the  ratio  of 
transportation  expenses  (45.67  per  cent  of  gross  rev¬ 
enue)  in  1922  was  not  materially  greater  than  the 
average  of  the  8  years  prior  to  1916. 


94 


Results  of  Operation  First  Four  Months  of  1923 

Results  for  the  4  months  ending  April  30, 1923,  com¬ 
pared  with  the  same  4  months  of  1922,  were  as  follows : 


4  Months  4  Months 

1922  1923  Increase 

Railway  Operating  Revenues.  .  .$24,833,466  $27,300,482  $2,467,016 
Railway  Operating  Expenses .  .  .  21,588,527  26,533,676  4,945,149 
Ratio  of  Expenses  to  Rev¬ 
enue .  86.93  97.19  10.26 


Decrease 


Railway  Net  Operating  Rev¬ 
enues  . 

$3,244,939 

$766,806 

$2,478,133 

Taxes  and  Rents: 

Taxes . 

$701,411 

$948,864  $247,453 

Rental  of  Equipment  (net)  . . 

1,020,415 

2,275,800  1,255,385 

Joint  Facility  Rents  (net)  .  . . 

55,433 

cr.  20,466  75,899 

Uncollectible  Ry.  Revenues  . . 

688 

99 

589 

Total  Taxes  and  Rents .... 

$1,667,081 

$3,245,229  $1,578,148 

Net  Railway  Operating  Income  $1,577,858 

$2,478,423  Def. 

$4,056,281 

Non-operating  Income . 

238,820 

238,266 

554 

Total  Income  Applicable  to 

Fixed  Charges . 

$1,816,678 

$2,240,157  Def. 

$4,056,835 

Fixed  Charges: 

Rental  of  leased  Roads . 

$306,792 

$306,792 

Interest  on  Debt . 

1,973,943 

2,056,667  $82,724 

Other  Deductions . 

282,157 

28,855 

$253,302 

Total  Fixed  Charges . 

$2,562,892 

$2,392,314 

$170,578 

Net  Income  (Deficit) . 

$746,214 

$4,632,471 

$3,886,257 

95 


The  principal  items  of  increased  transportation 
revenue  during  the  four  months  were : 

Freight  revenue  increased . $1,320,210  or  8% 

Passenger  revenue  increased. . . .  544,025  or  8% 

Express  revenue  increased .  284,079  or  39% 

Milk  revenue  increased .  69,701  or  12% 

If  operating  conditions  had  been  normal,  these  ex¬ 
cellent  increases  in  gross  revenue  should  logically  have 
resulted  in  increased  net  revenue.  But  operating 
expenses  increased  so  heavily  that  net  operating  rev¬ 
enue  was  $2,478,133  less  than  in  the  same  four  months 
of  1922.  Furthermore,  rentals  of  equipment  increased 
$1,255,385  or  123%,  and  accrued  taxes  increased 
$247,453  or  35%.  The  total  deficit  for  the  four  months 
was  $4,632,471  or  $3,886,257  worse  than  in  the  same 
period  of  1922. 

Analyzing  the  increases  in  operating  expenses  it 
appears  that: 

Maintenance  of  Way  and  Structures  increased. .  $530,250 
This  increase  is  more  than  accounted  for  by  the 
fact  that  the  cost  of  removing  snow  and  ice  was 
$1,063,998  in  the  four  months  of  1923  as  com¬ 
pared  with  $339,531  in  1922,  an  increase  of 
$724,467. 

Maintenance  of  Equipment  increased . $1,698,760 

This  increase  is  chiefly  accounted  for  by  the 
fact  that  Repairs  of  Steam  Locomotives  cost 
$3,480,762  in  the  four  months  of  1923,  as  com¬ 
pared  with  $1,990,410  in  1922,  an  increase  of 
$1,490,352. 


Transportation  Expenses  increased 


$2,780,628 


96 

The  principal  increases  in  Transportation  Expenses 
were : 

1.  Increased  cost  of  Fuel  for  Locomotives, 

$1,129,488  or  38% 

2.  Increases  in  wages  of  Enginemen  and  Train¬ 

men,  on  roads  and  in  yards,  $1,306,209  or  39% 

A  relatively  small  part  of  the  increased  transporta¬ 
tion  expenses  is  accounted  for  by  increased  traffic.  A 
considerable  part  of  the  increased  cost  of  fuel  is  un¬ 
doubtedly  due  to  the  higher  prices,  caused  by  the  coal 
strike.  The  remainder  of  these  increased  expenses  re¬ 
sulted  from  delays  to  traffic  caused  by  the  severe  winter 
and  from  the  unusually  poor  condition  of  locomotives 
and  equipment  resulting  from  the  shopmen’s  strike. 

Financial  Outlook  foe  1923 

In  the  year  1922  the  Boston  &  Maine  reached  May 
1  with  a  deficit  for  the  four  months  of  $746,214.  By 
the  end  of  1922  this  deficit  had  been  overcome  and  the 
road  showed  the  small  balance  over  fixed  charges  of 
$27,992. 

This  year  the  deficit  on  May  1  was  $4,632,471,  a 
sum  too  large  it  seems  to  permit  the  road  to  escape 
a  substantial  deficit  for  the  year  1923. 


\ 


97 


BOSTON  &  ALBANY  RAILROAD 

The  Boston  &  Albany  system  comprises  393  miles 
(Map  9).  It  has  444  passenger  cars,  7,412  freight  cars 
and  351  locomotives,  and  produced  during  the  year 
1922,  376,177,887  passenger  miles  and  1,089,660,257 
ton  miles  of  revenue  freight.  163  of  the  passenger 
cars  are  steel  and  126  wooden  with  steel  underframes. 

The  main  line  comprises  51  per  cent  of  the  total  mile¬ 
age  of  the  system  and  extends  from  Boston  to  its  connec¬ 
tion  with  the  New  York  Central  Railway  at  Rensse¬ 
laer,  a  distance  of  200  miles.  It  is  in  good  physical 
condition,  well  suited  to  the  volume  of  traffic  moving.* 
The  main  stem  has  two  tracks  throughout  its  entire 
length  and  considerable  third  track  to  help  the  freights 
in  their  slow  movement  up  the  heavy  grades  and  four 
and  five  tracks  within  the  Boston  suburban  area.  As 
compared  with  the  Shore  Line  of  the  New  Haven,  it  is 
handicapped  by  two  extremely  heavy  grades.  The  first 
reaches  its  summit  of  960  feet  at  Charlton;  thence  the 
line  descends  again  to  practically  tide  level  at  Spring- 
field  in  the  valley  of  the  Connecticut.  West  of  the 
Connecticut  the  road  rises  finally  by  heavy  grades  to 
an  elevation  of  1,440  feet,  where  it  crosses  the  backbone 
of  the  Berkshires.  Again  the  line  descends  to  the  val¬ 
ley  of  the  Housatonic  at  Pittsfield  950  feet  above  ocean 
level.  Prom  here  by  easier  grades  the  road  continues 
to  its  western  terminus  at  Rensselaer. 

*  Appendix  L.  Revenue  Ton  Miles  and  Passenger  Miles,  Boston  &  Albany 
Railroad,  1903-1922  (Chart). 


98 


The  movement  of  freight  upon  this  line  is  very 
heavy.  The  Boston  &  Albany  has  a  practical  monopoly 
of  the  through  passenger  business  between  New  Eng¬ 
land  and  the  West,  and  as  on  the  Shore  Line  of  the 
New  Haven  the  movement  of  freight  is  complicated  by 
the  necessity  of  caring  for  frequent  high  speed  pas¬ 
senger  trains.  Ten  through  express  passenger  trains 
daily  in  each  direction  travel  between  Boston  and  Al¬ 
bany  and  also  in  addition  a  number  of  New  York 
express  trains  pass  over  the  main  line  for  100  miles 
to  Springfield.  The  road  has  established  the  trans¬ 
portation  policy  of  moving  its  freights  relatively  fast 
as  compared  with  the  practice  on  the  main  line  of  the 
N ew  Haven  Railroad.  This  policy  is  probably  partly  to 
keep  the  freights  out  of  the  way  of  the  passenger 
trains  or,  to  put  it  another  way,  in  order  to  permit  a 
freight  train  to  make  a  good  run  between  the  move¬ 
ment  of  two  passenger  trains  before  it  is  overtaken 
by  the  second.  This  is  not  altogether  an  operating  dis¬ 
advantage.  A  heavy  freight  of  3,000  tons  moving  at 
an  average  speed  of  8  miles  an  hour  manufactures  the 
same  ton  miles  per  hour  as  a  train  of  2,000  tons  moving 
at  12  miles  an  hour. 


99 


Freight  Car  Movement 

The  Boston  &  Albany,  as  we  have  already  noted, 
stands  at  the  head  of  the  New  England  list  in  the  aver¬ 
age  daily  movement  per  car  for  all  cars  on  the  system. 
The  following  are  the  figures  for  the  year  ending  June 
30,  1922 : 


Car  Miles  per 

Bad  Order 

Freight  Car  Day 

Cars 

(All  Cars) 

Eliminated 

Boston  &  Albany . 

.  27.8 

30.0 

Atlantic  &  St.  Lawrence  . . . . 

.  21.8 

23.3 

Central  Vermont . 

.  19.3 

29.5 

Maine  Central  . 

.  17.8 

91  9 

tmJ 

Rutland  . 

.  17.7 

23.6 

Boston  &  Maine  . 

.  17.1 

21.2 

Bangor  &  Aroostook . 

.  13.8 

19.3 

New  Haven  . 

.  13.6 

18.1 

Net  Ton  Miles  per  Car  Day 

The  Boston  &  Albany  also  stands  at  the  top  in  the 
average  net  ton  miles  per  freight  car  day:  Year  ending 
June  30,  1922. 


Boston  &  Albany  .  365 

Atlantic  &  St.  Lawrence .  347 

Central  Vermont  .  268 

Maine  Central .  264 

Rutland  .  247 

Boston  &  Maine .  246 

New  Haven  .  198 

Bangor  &  Aroostook .  186 


100 


Percentage  of  Cars  Moved  Daily 

The  percentage  moved  each  day  of  the  average  num¬ 
ber  of  cars  ready  to  be  moved,  for  the  year  ending 
June  30,  1922,  was  the  highest  in  New  England.  Dur¬ 
ing  the  six  months  ending  December  31,  1922,  it  was 
the  next  to  the  highest.  We  give  the  comparison  for 
the  year  ended  June  30,  1922,  and  for  the  six  months 
ending  December  31,  1922. 


Year  Ending 

6  Mos.  Ending 

June  30, 1922 

Dec.  31, 1922 

Boston  &  Albany  . 

....  80.3% 

77.2% 

Butland  . 

....  78.4 

80.0 

Maine  Central . 

....  76.6 

71.7 

Central  Vermont . 

....  76.1 

69.9 

Bangor  &  Aroostook  . . . 

....  75.8 

75.8 

New  Haven  . 

....  69.2 

58.7 

Boston  &  Maine  . 

....  61.5 

56.2 

Atlantic  &  St.  Lawrence 

....  58.3 

63.1 

Yard  and  Terminal  Operation 

The  classification  at  the  western  end  of  the  Boston  & 
Albany  is  performed  for  it  by  the  New  York  Central 
in  its  West  Albany  yard. 

The  Boston  &  Albany  maintains  a  large  flat  classi¬ 
fication  yard  at  West  Springfield,  but  it  is  hardly 
fair  to  compare  the  results  attained  in  this  yard 
with  the  time  consumed  at  Maybrook  or  with  the 
Mechanicville  yard  of  the  Boston  &  Maine.  West 
Springfield  is  more  nearly  comparable  to  the  East 
Deerfield  yard  of  the  Boston  &  Maine  system.  For 
the  year  ending  June  30,  1922,  including  cars  moving 
in  both  directions,  an  average  of  1220  cars  daily  were 


101 


handled.  The  average  delay  was  6.1  hours,  an  admir¬ 
able  record,  less  than  half  the  time  consumed  (12.7 
hours)  at  the  East  Deerfield  yard  of  the  Boston  & 
Maine  for  the  same  period. 

At  Springfield  the  New  Haven  and  Boston  &  Maine 
also  operate  freight  yards. 

The  Springfield  yard  of  the  New  Haven  railroad  is 
small  and  is  not  a  classification  yard.  The  cars  handled 
here  during  the  year  ending  June  30,  1922,  averaged 
143  a  day  and  were  delayed  an  average  of  17.4  hours. 
The  yard  of  the  Boston  &  Maine  is  also  a  small  yard, 
and  handled  an  average  daily,  for  the  same  period, 
of  97  cars  and  the  average  delay  was  7.2  hours  —  a 
good  record. 

It  is  not  necessary  to  go  into  further  detail  in  regard 
to  the  operation  of  the  Boston  &  Albany  road.  It  has 
arduous  grades  on  its  main  line  instead  of  the  nearly 
water  level  route  of  the  New  Haven  line  from  Boston 
to  New  York,  but  with  a  relatively  high  percentage  of 
main  line  and  small  branch  mileage  it  presents  a 
simpler  operating  problem  than  the  New  Haven,  or 
the  Boston  &  Maine.  It  certainly  maintains  a  high 
standard  of  operating  efficiency,  and  makes  the  most 
of  every  favorable  condition. 


Embargo  Policy 

The  Boston  &  Albany  management  does  not  believe 
in  the  permit  system,  and  no  permits  are  granted.  The 
officials  watch  the  condition  and  performance  of  their 
road  and  the  loads  coming  towards  them  far  back  on 


102 


the  connecting  lines,  and  if  they  fear  congestion  put  on 
a  general  embargo  with  the  usual  published  exceptions, 
perishables,  foodstuffs,  etc.,  and  then  in  a  few  days, 
or  as  soon  as  possible,  withdraw  the  embargo. 

We  give  for  the  period  from  January,  1922,  to  April, 
1923,  the  daily  averages  by  months  of  total  cars  on  the 
system  and  the  car  miles  per  freight  car  day: 

Average  Car  Miles  Per  Cent  of  Cars 
per  Moved  of 

Month  Cars  on  Line  Freight  Car  Day  Total  to  be  Moved 


1922  —  January  . 

. 7,948 

24.9 

80.6 

February  .... 

. 8,503 

27.6 

84.4 

March  . 

. 8,533 

28.5 

83.0 

April  . 

. 8,069 

26.2 

81.3 

May  . 

. 8,236 

27.0 

79.4 

June  . 

. 8,782 

26.9 

79.7 

July  . 

. 8,139 

25.2 

75.5 

August  . 

. 7,738 

28.0 

78.1 

September  . . . 

. 8,198 

27.1 

76.3 

October  . 

. 8,970 

28.8 

78.1 

November  . . . 

_ _ _ 9,455 

29.6 

77.5 

December  .... 

25.4 

78.4 

1923  —  January  . 

. 9,878 

21.8 

71.7 

February  .... 

. 9,907 

24.2 

74.1 

March  . 

. 10,678 

27.8 

76.6 

April  . 

. 11,051 

29.7 

78.7 

This  table  seems  to  indicate  that  in  spite  of  the  un¬ 
expected  and  wholly  abnormal  adverse  winter  condi¬ 
tions  reducing  drawbar  pull  of  locomotives  and  hin¬ 
dering  operation  of  trains  over  the  Berkshire  Hills 
and  impeding  switching  in  yards,  the  management  at 
all  times  kept  the  flow  of  traffic  under  control. 

The  figures  reflect  of  course  to  some  extent  the  ad¬ 
verse  wTeather  conditions  of  last  winter,  but  it  is  clear 
a  sound  and  adaptable  judgment  was  at  the  control 
lever,  and  at  no  time  so  far  as  we  can  see  did  the  road 
become  over-congested  or  get  out  of  hand. 


103 


The  daily  car  miles  were  well  maintained  and  the 
percentage  of  cars  moved  of  cars  ready  to  be  moved 
was  kept  high.  Adverse  per  diems  were  kept  under 
control : 


1922  —  January  .  $106,441 

February  . 116,994 

March  . 137,318 

April  . 124,096 

May  . 114,908 

June .  118,103 

July  . 118,533 

August  . . ...  131,296 

September  .  151,410 

October  . 198,885 

November . 203,588 

December  . 220,065 


Total  12  months . $1,741,637 

1923  —  January  .  $230,938 

February  . . . .  204,414 

March  . 269,176 

April  .  266,246 


Total  16  months .  $2,712,411 


This  favorable  result  was  not  obtained  because  New 
York  Central  operating  officials  were  favoring  the 
Boston  &  Albany,  for  per  diems  are  charged  by  the 
New  York  Central  against  the  Boston  &  Albany  ex¬ 
actly  as  against  any  foreign  road. 

It  may  be  urged  that  the  Boston  &  Albany  reached 
an  amicable  adjustment  with  its  shopmen  and  that  it 
was  not  embarrassed  in  its  operation  by  the  necessity 


104 


of  recruiting  a  new  force.  This  should  not  be  disre¬ 
garded,  but  the  embargo  policy  of  the  operating  officials 
of  any  given  railroad  should  not  be  related  to  their 
road  as  it  could  be,  or  might  be,  or  should  be,  but  as  it 
actually  is.  An  embargo  can  be  declared,  suspended, 
modified,  or  restored,  as  is  often  done,  from  day  to  day 
or  week  by  week  according  to  operating  conditions  on 
the  road.  If  the  weather  becomes  rough  or  a  road  has 
a  high  percentage  of  locomotives  out  of  order  due  to 
shop  troubles  then  these  facts  should  have  their  full 
and  due  effect  in  dictating  from  day  to  day  the  embargo 
policy. 


Locomotive  Repairs 

The  record  of  the  Boston  &  Albany  in  the  matter 
of  locomotive  repairs  seems  to  point  to  efficiency  in 
locomotive  shops  and  at  roundhouses. 

The  engines  of  the  Boston  &  Albany  averaged  36,240 
pounds  of  tractive  power  in  1921,  being  substantially 
heavier  than  the  engines  of  the  Boston  &  Maine  or 
New  Haven  or  Maine  Central,  yet  the  average  cost  per 
locomotive  mile  although  slightly  higher  than  the 
Maine  Central  was  much  lower  than  either  the  Boston 
&  Maine  or  New  Haven.  This  result  is  due  in  part 
to  the  fact  that  the  engines  of  the  Boston  &  Albany 
are  newer  than  those  of  the  other  two  roads  and 
the  engine  runs  longer,  making  possible  greater  miles 
per  locomotive,  but  our  study  indicates  that  the  shop 
methods,  the  equipment  of  the  roundhouses  and  the 
policy  of  making  heavier  repairs  in  the  roundhouses 
than  is  done  on  the  Boston  &  Maine  or  New  Haven 


105 


have  contributed  to  the  low  cost  of  repairs  per  loco¬ 
motive  mile  on  the  Boston  &  Albany. 

We  give  below  the  cost  per  locomotive  mile,  miles 


per  locomotive, 

and  the  average 

tractive 

power  per 

locomotive  for  the  year  ended  December  31,  1921 : 

Cost  per 

Tractive  power 

locomotive 

Miles  per 

per  locomotive 

mile  (cents) 

locomotive 

(Pounds) 

Boston  &  Albany  . . . 

.  23.52 

28,369 

36,240 

Boston  &  Maine . 

.  30.67 

20,535 

27,715 

New  Haven  (steam) 

.  35.03 

18,124 

31,097 

M  aine  Central . 

24,000 

31,149 

Bangor  &  Aroostook  . 

.  24.23 

19,599 

25,674 

Central  Vermont  . . . . 

25,713 

27,454 

Rutland  . 

24,364 

32,046 

106 


MAINE  CENTRAL  RAILROAD 

General  Description 

The  Maine  Central  system  comprises  645  miles  of 
line  owned,  541  miles  leased,  and  15  miles  operated 
under  trackage  rights  (Map  10).  It  also  operates  two 
narrow  gauge  lines,  totaling  125  miles.  It  owns  and 
operates,  for  the  joint  benefit  of  itself  and  the  Boston 
&  Maine,  the  Portland  Terminal  Company. 

It  has  230  locomotives;  7,489  freight  cars;  and  292 
passenger  cars,  of  which  37  are  steel,  52  steel  under¬ 
frame,  and  203  wooden. 

The  main  line  extends  from  Portland  through 
Brunswick,  Augusta,  Waterville  and  Bangor  to  Vance- 
boro,  249  miles.  The  extreme  eastern  end  of  this  line, 
from  Mattawamkeag  to  Yanceboro,  56  miles,  is  also 
used  by  the  Canadian  Pacific  as  part  of  its  main  line 
from  Montreal  to  St.  John.  Part  of  the  main  line 
traffic  is  carried  on  a  line  which  extends  from  Port¬ 
land  to  Waterville  by  way  of  Auburn  and  Lewiston, 
forming  in  effect  a  second  track  between  Portland  and 
Waterville. 

The  Maine  Central  has  many  branches.  The  long¬ 
est  extends  from  Portland  through  the  White  Moun¬ 
tains  to  Lime  Ridge,  Quebec,  206  miles,  with  a  branch 
of  its  own  to  St.  Johnsbury,  Vermont,  32  miles.  At 
various  points  on  these  branches  connection  is  made 
with  the  Boston  &  Maine,  the  Canadian  Pacific,  and 
the  Grand  Trunk.  Another  long  branch  is  the  Wash- 


107 


ington  County,  running  from  Washington  Junction 
eastward  to  Calais,  102  miles.  At  Calais  connection  is 
made  with  a  branch  of  the  Canadian  Pacific.  There 
are  various  other  branches  —  reaching  Belfast,  Mt. 
Desert  Ferry,  Dover-Foxcroft,  Kineo,  Rangeley,  Ken- 
nebago.  Of  the  total  mileage  operated  more  than  65 
per  cent  is  branch.  Traffic,  both  freight  and  passen¬ 
ger,  over  most  of  these  branches  is  light.  In  fact,  a 
characteristic  feature  and  great  handicap  of  the  Maine 
Central  is  its  high  percentage  of  unprofitable  branch 
lines. 

Total  revenue  ton  miles  produced  by  the  Maine  Cen¬ 
tral  in  the  year  ending  December  31, 1922,  amounted  to 
857,667,341,  an  increase  over  1912  of  40.02  per  cent. 
Passenger  miles  totaled  128,430,706,  a  decrease  from 
1912  of  20.4  per  cent.* 

The  chief  points  of  freight  interchange  are  at  Port¬ 
land,  with  the  Boston  &  Maine,  and  at  Northern  Maine 
Junction  (Bangor)  with  the  Bangor  &  Aroostook.  At 
Portland  the  road  received  from  the  Boston  &  Maine 
in  the  year  ending  June  30,  1922,  a  daily  average  of 
437  cars,  and  delivered  432.  Loaded  cars  delivered 
largely  exceeded  those  received  owing  to  the  bulky  ton¬ 
nage  furnished  by  the  sawmills  and  pulpmills  and  by 
the  Aroostook  potato  crop.  During  the  calendar  year 
1922  the  road  hauled  42,005  cars  of  lumber,  40,287  cars 
of  pulpwood,  25,923  cars  of  paper,  and  34,302  cars  of 
potatoes,  comprising  45  per  cent  of  the  total  tonnage 
carried  that  year.  The  interchange  with  the  Bangor  & 

*  Appendix  M.  Revenue  Ton  Miles  and  Passenger  Miles,  Maine  Cen¬ 
tral  Railroad,  1903-1922  (Chart). 


108 


Aroostook  at  Northern  Maine  Junction  amounted  to  a 

» 

daily  average  in  the  year  ending  J une  30,  1922,  of  154 
cars  received  and  157  cars  delivered. 

The  Maine  Central  is  the  chief  rail  outlet  to  the 
market  of  lower  New  England  for  the  extensive  terri¬ 
tory  in  eastern  and  northern  Maine,  New  Brunswick 
and  the  easterly  portion  of  the  Province  of  Quebec. 


Operation 

We  find  that  the  Maine  Central  is  well  operated. 
For  the  year  ending  June  30,  1922,  it  maintained  a 
daily  average  movement  per  freight  car  day  of  17.8 
miles.  It  produced  264  net  ton  miles  per  car  per  day, 
standing  fourth  in  the  list  of  New  England  roads  (year 
ending  June  30, 1922)  : 


Boston  &  Albany 

Net  Ton  Miles  per 
Freight  Car  Day 

365 

Atlantic  &  St.  Lawrence 

347 

Central  Vermont 

268 

Maine  Central 

264 

Butland 

247 

Boston  &  Maine 

246 

New  Haven 

198 

Bangor  &  Aroostook 

186 

This  road  measures  up  well  also  if  we  apply  the 
test  of  comparing  the  average  cars  moved  each  day 
with  the  number  of  cars  ready  to  be  moved : 


109 


Boston  &  Albany 

Year  Ending 
June  30, 1922 

80.3% 

6  Mos.  Ending 
Dec.  31, 1922 

77.2% 

Rutland 

78.4 

80.0 

Maine  Central 

76.6 

71.7 

Central  Vermont 

76.1 

69.9 

Bangor  &  Aroostook 

75.8 

75.8 

New  Haven 

69.2 

58.7 

Boston  &  Maine 

61.5 

56.2 

Atlantic  &  St.  Lawrence 

58.3 

63.1 

The  yard  delays  on  the  Maine  Central  are  small. 
Portland  shows  the  longest  detention.  For  the  year 
ending  June  30,  1922,  this  was  11.6  hours.  The  av¬ 
erage  delay  for  movement  of  cars  through  all  the  yards 
in  the  whole  system,  including  Portland,  for  the  year 
ending  June  30,  1922,  was  7.3  hours.  The  new  classi¬ 
fication  yard  now  under  construction  is  expected  to 
effect  a  material  reduction  in  car  delay  at  Portland. 

The  number  of  bad  order  cars  on  this  system  is  low, 
averaging  during  1922  only  7.9  %  of  the  total  cars  on 
the  line,  compared  with  an  average  for  all  the  railroads 
of  the  country  of  12.5%,  and  with  the  following  for  the 
New  England  roads  (year  ending  Dec.  31, 1922)  : 


Railroad 

Freight  Cars 
Per  cent 
Unserviceable 

Boston  &  Albany 

5.9 

Atlantic  &  St.  Lawrence 

6.0 

Maine  Central 

7.9 

Boston  &  Maine 

16.7 

Rutland 

21.2 

New  Haven 

23.6 

Bangor  &  Aroostook 

24.2 

Central  Vermont 

26.5 

U.  S.  (excluding  New  England  lines) 

12.5 

110 


The  average  percentage  of  locomotives  out  of  serv¬ 
ice  awaiting  repairs  requiring  more  than  24  hours 
for  the  calendar  year  1922  also  makes  a  fair  compari¬ 
son  with  the  other  New  England  roads: 


Per  cent  Unserviceable 
Locomotives 


Freight 

Passenger 

Central  Vermont 

20.6 

21.6 

Boston  &  Albany 

20.7 

19.8 

Rutland 

23.3 

13.3 

New  Haven 

24.2 

28.3 

Maine  Central 

24.6 

20.8 

Atlantic  &  St.  Lawrence 

24.8 

15.5 

Bangor  &  Aroostook 

25.8 

28.2 

Boston  &  Maine 

29.5 

32.6 

Locomotive  Repairs 

We  have  already  commented  on  the  low  cost  of  loco¬ 
motive  repairs  on  the  Maine  Central  in  our  discussion 
of  the  Boston  &  Maine.  There  seems  to  be  a  high 
degree  of  efficiency  in  this  branch  of  the  service. 


Financial 

The  capitalization  of  this  road  in  1915  was:  bonds 
$12,661,500,  common  stock  $24,888,000.  By  December 
31,  1922,  the  amount  of  bonds  had  been  practically 
doubled  —  $24,212,600,  and  the  common  stock  cut  in 
halves  — $12,006,000.  $3,000,000  of  5%  preferred  stock 
was  issued  in  1916. 


Ill 


This  large  increase  in  bonds,  the  issue  of  the  pre¬ 
ferred  stock,  and  the  reduction  of  the  common  stock 
are  in  large  part  explained  by  the  purchase  in  1916 
of  $15,960,000  common  stock  owned  by  the  Boston 
&  Maine,  constituting  a  majority  of  the  common 
stock.  In  carrying  out  this  purchase  of  its  common 
stock  owned  by  the  Boston  &  Maine,  the  Maine  Cen¬ 
tral  reduced  its  common  stock  from  $25,000,000  to 
$15,000,000,  and  as  it  took  into  its  treasury  $2,881,500 
in  effect  reduced  its  outstanding  common  stock  in  the 
hands  of  the  public  from  the  $24,888,000  as  it  stood 
in  1915  to  $12,006,900  in  1916.  At  this  figure  the  com¬ 
mon  stock  in  the  hands  of  the  public  still  stands  to¬ 
day.  In  order  to  assist  in  the  purchase  of  this  stock 
owned  by  the  Boston  &  Maine,  the  Maine  Central  in 
1916  issued  $7,000,000  mortgage  bonds,  carrying  in¬ 
terest  at  4%%,  and  $3,000,000  of  5%  preferred  stock. 

During  the  adverse  years  of  1918-1919-1920  the  road 
showed  heavy  deficits,  but  in  1922  the  road  showed 
fixed  charges  again  earned. 

During  the  first  two  months  of  the  current  year  the 
road  was  hard  hit  by  the  shop  strike,  unusual  winter 
storms  and  by  the  embargoes  declared  by  its  southern 
connection,  but  April  showed  more  than  twice  fixed 
charges  earned,  and  we  see  no  reason  to  believe  this 
road  is  not  going  to  show  in  the  future  substantial  earn¬ 
ings  above  fixed  charges. 


112 


We  give  below  a  summary  of  tbe  road’s  income  ac¬ 
count,  1911-1922,  and  by  months  for  1923  to  date : 


Year 

Gross 

Earnings 

Net  Railway 
Operating  Income 

Net  income 
after  fixed 
charges 

Dividends 

1911  . . . . 

.$9,300,999 

$2,031,963 

$  444,477 

$  398,152 

1912  . . . . 

.11,114,615 

2,303,934 

540,371 

441,860 

1913  . . . . 

.  11,494,688 

2,470,169 

1,138,979 

1,010,277 

1914  .... 

.11,833,989 

2,603,920 

1,386,189 

1,491,797 

1915  .... 

.11,352,258 

2,527,206 

1,618,080 

1,483,002 

1916  . . . . 

.12,001,673 

3,123,944 

1,600,476 

1,111,123 

1917  . . . . 

.14,125,577 

2,729,314 

1,056,065 

870,888 

1918  .... 

.  16,415,178 

595,895  (deficit) 

972,193 

870,888 

1919  .... 

.17,525,178 

1,231,427  (deficit) 

1,085,971 

870,888 

1920  .... 

.21,357,508 

2,647,174  (deficit) 

304,433 

653,166 

1921  .... 

.20,590,064 

*20,538 

*1,677,862  (deficit) 

1922  . . . . 

.  20,3S7,172 

*2,355,143 

*63,657 

1923 

January  . 

.  1,516,549 

184,190  (deficit) 

338,474  (deficit) 

February  . 

1,406,849 

233,838  (deficit) 

390,282  (deficit) 

March  . . 

.  1,819,443 

59,700 

96,778  (deficit) 

April  . . . 

.  1,986,982 

438,432 

277,087 

*  Net  Income  in  1922  was  increased  by  a  Credit  to  Operating  Expenses 
of  $487,500,  on  account  of  an  adjustment  applicable  to  1921  expenses. 
We  have  therefore  taken  this  credit  out  of  1922  expenses  and  applied  it 
to  1921  expenses  in  order  to  make  the  results  in  the  two  years  properly 
comparable. 


113 


BANGOR  AND  AROOSTOOK  RAILROAD 

The  Bangor  &  Aroostook  Railroad  comprises  616 
miles  of  line  located  in  Northern  Maine, — main  line 
259  miles,  branches  357.  (Map  11.)  It  owns  95  loco¬ 
motives,  81  passenger  cars,  4,224  freight  cars.  The 
main  line  extends  from  Searsport  on  Penobscot  Bay  to 
Van  Buren  on  the  St.  John  River.  Its  important 
branches  are  from  Oldtown  to  Greenville  on  Moose- 
head  Lake,  and  from  Oakfield  to  St.  Francis  through 
Fort  Kent.  The  Bangor  &  Aroostook  controls  the 
bridge  across  the  St.  John  River  and  International 
Boundary  to  St.  Leonard,  New  Brunswick,  connecting 
with  the  Canadian  Government  Railway  System  and 
the  Canadian  Pacific  Railway.  The  most  important 
interchange  is  with  the  Maine  Central  Railroad  at 
Northern  Maine  Junction  (Bangor),  where  the  aver¬ 
age  daily  interchange  of  cars  during  the  year  ending 
June  30,  1922,  was  311.  The  railroad  has  tidewater 
terminals  at  Stockton  Harbor  and  Searsport  which  are 
capable  of  handling  a  large  volume  of  traffic,  but  are 
not  actively  used. 

The  total  traffic  in  1922  was  267,482,345  freight  ton 
miles,  and  20,580,555  passenger  miles.* 

The  territory  served  is  sparsely  settled  averaging  244 
persons  per  mile  of  road,  much  the  lowest  in  New  Eng¬ 
land.  Passenger  earnings  are  light,  comprising  only 
12  per  cent  of  gross  income. 

Northern  Maine  contains  no  consuming  market  of 
importance  nor  has  it  any  industries  to  attract  popula- 

*  Appendix  X.  Revenue  Ton  Miles  and  Passenger  Miles,  Bangor  &  Aroos¬ 
took  Railroad,  1903-1922  (chart). 


114 


tion  other  than  those  producing  paper,  lumber  and 
forest  products  and  potato  starch.  No  mineral  de¬ 
velopments  exist.  It  burns  mostly  hard  wood  for  fuel 
and  raises  much  of  its  food.  Inbound  movements  are 
principally  confined  to  coal  and  fertilizers  arriving  by 
water,  and  food,  mill  supplies,  etc.,  coming  by  rail. 
These  do  not  bring  in  many  of  the  cars  needed  for  out¬ 
bound  loading,  hence  a  large  number  of  empty  cars 
are  moved  north.  Potatoes,  lumber,  pulpwood,  and 
newsprint  paper  constituted  62  per  cent  of  the  total 
freight  carried  in  1922.  Potatoes  wrere  24.27  per  cent 
of  the  total  in  1922,  when  24,630  cars  were  handled. 
This  heavy  movement  originates  on  and  north  of  the 
latitude  of  the  City  of  Quebec  and  is  moved  between 
October  and  March  during  the  season  of  lowest  tem¬ 
perature.  It  moves  in  specially  heated,  lined  cars  and 
in  pre-heated  refrigerator  cars  which  are  returned 
empty.  The  variation  of  potato  crops,  both  in  quantity 
and  in  season  produces  either  surplus  or  shortage  of 
the  special  equipment  required.  Price  fluctuations  and 
other  conditions  incident  to  unorganized  marketing 
produce  underload  and  overload  for  the  carrier  and  its 
connections.  Congestion  in  lower  New  England  fre¬ 
quently  prevents  either  the  forwarding  of  non-perish¬ 
able  freight  or  the  return  of  heater  and  lined  cars. 
During  the  past  winter  the  disabilities  of  some  of  the 
other  New  England  railroads  was  costly  to  the  North¬ 
ern  Maine  territory  and  as  well  to  both  the  Bangor  & 
Aroostook  and  the  Maine  Central.  Shipments  to  New 
York  and  Boston  by  water  from  Portland  were  moved 
last  winter  without  serious  delay  but  in  limited 
quantity. 


115 


In  the  opinion  of  the  Committee  this  road  is  operated 
with  marked  efficiency.  It  has  disabilities,  as  we  have 
already  noted,  which  present  difficult  operating  prob¬ 
lems.  The  constant  flow  of  empties  northbound,  and 
the  assembling  of  refrigerator  and  heater  cars  to  pro¬ 
tect  uncertain  potato  shipments  impair  the  net  ton 
mileage  factor  greatly.  Our  investigation  develops 
that  cars  once  loaded  leave  the  line  very  promptly, 
usually  within  twenty-four  hours.  They  are  not  held 
to  create  a  fixed  train  tonnage,  but  are  moved  in  light 
trains  from  the  assembling  territory.  These  trains  are 
increased  at  each  braneh  line  junction  until  full  ton¬ 
nage  rating  has  been  reached,  after  which  the  train 
moves  to  Northern  Maine  Junction  without  delay.  The 
road  has  a  surplus  of  locomotives  and  an  adequate  sup¬ 
ply  of  freight  cars, —  6.86  per  mile  of  road,  and  is  a 
credit  per  diem  road.  Its  income  from  rentals  of  loco¬ 
motives  and  cars  to  other  roads  is  a  substantial  item 
of  annual  income.  The  percentage  of  cars  moved  each 
day  of  the  total  number  of  cars  ready  to  be  moved, 
for  the  year  1922,  was  75.8  per  cent,  which  was  good 
practice,  and  is  1.8  per  cent  better  than  the  average 
performance  of  51  of  the  leading  railroads  of  the 
United  States  for  the  same  period. 

This  road  has  paid  dividends  on  its  common  stock 
for  a  number  of  years  and  has  been  physically  well 
maintained.  It  is  serving  a  territory  still  in  the  early 
stages  of  development  and  capable  of  producing  more 
freight  tonnage  than  at  present.  The  thin  population 
and  the  absence  of  large  cities  simplify  operation  of 
the  railroad  and  relieve  it  from  many  of  the  burdens 
which  inflate  the  cost  of  operation  in  lower  New 
England. 


GRAND  TRUNK  RAILWAY 


The  Grand  Trunk  Railway  has  two  important  arms 
reaching  into  New  England,  one  the  Atlantic  &  St. 
Lawrence,  leased  for  999  years  to  the  Grand  Trunk 
Railway,  the  other  the  Central  Vermont,  controlled 
by  majority  stock  ownership  —  about  seventy-five  per 
cent.  (Map  12.) 

Central  Vermont  Railway 

The  Central  Vermont  Railway  leaves  the  main  line  of 
the  Grand  Trunk  at  St.  Johns,  Canada.  The  Grand 
Trunk  also  connects  by  a  line  used  practically  wholly 
for  freight  at  Alburg  J unction,  Vermont.  The  Central 
Vermont,  however,  extends  50  miles  north  of  S wanton 
in  the  direction  of  Montreal  to  St.  Johns,  Quebec, 
where  its  passenger  trains  continue  on  another  27 
miles  over  the  Grand  Trunk  to  Montreal.  Returning 
to  Alburg  Junction,  the  Central  Vermont  runs  in  a 
generally  southerly  direction  through  Vermont,  pass¬ 
ing  St.  Albans,  Bellows  Falls,  and  Brattleboro,  crosses 
the  Boston  &  Maine  Fitchburg  line  at  Millers  Falls, 
the  Boston  &  Albany  at  Palmer  and  finally  reaches 
tidewater  at  New  London,  Connecticut.  The  Central 
Vermont  by  a  branch  reaches  Burlington,  Vermont, 
on  Lake  Champlain  and  Rouses  Point,  New  York,  also 
on  Lake  Champlain.  The  main  north  and  south  line 
is  344  miles  in  length,  including  some  49  miles  of  Bos¬ 
ton  &  Maine  track  and  14  miles  of  Central  Vermont 
track,  used  by  both  systems  under  a  joint  trackage 


117 


agreement.  The  Central  Vermont  maintains  a  nightly 
boat  service  for  freight  between  New  York  and  New 
London  and  thus  gathers  at  New  York  freight  for 
movement  north  and  west.* 

The  Central  Vermont  offers  shippers  a  differential 
rate  to  the  west  via  the  Grand  Trunk.  This  differen¬ 
tial  rate  out  of  New  England  was  first  put  into  effect 
by  Governor  J.  Gregory  Smith  of  Vermont,  then  Pres¬ 
ident  of  the  Central  Vermont  Railway  more  than  forty 
years  ago  and  before  control  was  acquired  by  the  Grand 
Trunk.  Freight  moving  to  the  Central  Vermont  from 
Boston  over  the  Boston  &  Maine  system  goes  north 
through  Lowell,  Nashua,  Manchester,  Concord,  and 
thence  to  White  River  Junction,  Vermont,  in  the  Con¬ 
necticut  Valley.  In  the  year  ending  June  30, 1922,  the 
Boston  &  Maine  delivered  to  the  Central  Vermont  a 
daily  average  of  36  loaded  cars,  and  received  a  daily 
average  of  91  loaded  cars.  The  New  Haven  system 
also  delivers  a  small  amount  of  traffic  to  the  Central 
Vermont  at  Willimantic  and  a  few  cars  at  New  Lon¬ 
don. 

It  does  not  seem  necessary  to  discuss  in  detail  the 
operation  of  the  Central  Vermont.  The  road  has  had 
the  benefit  during  recent  years  of  the  expenditure  of 
but  a  very  limited  amount  of  new  capital.  For  the 
year  ending  June  30,  1922,  it  moved  daily  76.1%  of 
the  business  to  be  moved,  and  for  the  six  months 
ending  December  31,  1922,  it  moved  daily  69.9%, 
which  indicates  good  operation,  being  above  the  aver¬ 
age  for  the  United  States.  It  has  been  able  since 

*  Appendix  O.  Revenue  Ton  Miles  and  Passenger  Miles,  Central  Vermont 
Railway,  1903-1922  (chart). 


118 

December  31,  1922,  to  reduce  its  bad  order  freight 
equipment  to  5.9%. 

Grand  Trunk  Extension  to  Providence 

In  1912  the  Grand  Trunk  Railway  began  to  build 
a  line  from  the  Central  Vermont  at  Palmer  to  Provi¬ 
dence,  R.  I.  Work  on  this  line  was  suspended  within 
two  years  but  not  until  the  right  of  way  both  in  Massa¬ 
chusetts  and  Rhode  Island  had  been  secured  and  the 
grading  75%  completed.  The  opening  of  this  line 
would  be  of  real  importance  to  New  England  and  is 
especially  vital  to  Providence  and  Rhode  Island.  Upon 
representation  by  the  Grand  Trunk  officials  that  the 
road  would  be  completed  the  legislature  of  Rhode  Is¬ 
land  has  recently  extended  the  Rhode  Island  charter 
and  upon  the  same  representation  an  extension  has 
also  been  granted  in  Massachusetts. 

Importance  of  Canadian  Routes 

In  the  tentative  consolidation  plan  of  the  Interstate 
Commerce  Commission  it  was  not  proposed  that  these 
New  England  lines  controlled  by  the  Grand  Trunk 
should  form  a  part  of  any  consolidated  American  sys¬ 
tem,  and  in  our  judgment  they  should  unquestionably 
remain  in  the  control  of  the  Grand  Trunk  Railway. 
They  give  New  England  another  means  of  access  to 
the  W est  on  a  favorable  basis  of  pates.  To  the  average 
New  Englander  a  shipment  of  freight  from  New  Eng¬ 
land  to  Chicago  by  way  of  the  Grand  Trunk  may  seem 
roundabout  but  as  a  matter  of  fact  this  route  is  only 


119 


about  a  hundred  miles  longer  than  the  shortest  alterna¬ 
tive  American  route  (New  York  Central)  and  it  is 
shorter  than  several  of  the  routes,  as  for  example  the 
Erie,  Baltimore  &  Ohio,  or  the  Pennsylvania,  regularly 
used  by  New  England  shippers. 


Distances  Boston  to  Chicago 
New  York  Central  —  Boston  &  Maine,  Fitch¬ 


burg  Division  1021 

New  York  Central  —  Boston  &  Albany  1026 

Grand  Trunk  —  Boston  &  Maine  1129 

Pennsylvania  —  New  Haven  1137 

Canadian  Pacific  —  Boston  &  Maine  1189 

Erie  —  New  Haven  1226 

Baltimore  &  Ohio  —  New  Haven  1248 


The  American  lines  all  pass  through  heavy  traffic 
points  which  are  apt  to  be  congested  and  cause  serious 
delay  in  times  of  active  movement.  These  standard 
routes  are  also  heavy  coal  carriers,  especially  during 
the  winter  months  when  weather  conditions  are  un¬ 
favorable.  The  Grand  Trunk  route  reaches  Chicago 
with  a  straight  line  haul,  passing  through  no  congested 
points,  and  does  not  have  a  heavy  coal  traffic  thrown 
upon  it  during  the  winter  months.  The  daily  manifest 
freight  express  carrying  packing  house  products  leaves 
Chicago  every  day  for  Boston,  via  Grand  Trunk,  Cen¬ 
tral  Vermont,  Boston  &  Maine,  affording  the  same 
service  as  the  corresponding  fast  provision  train 
leaving  Chicago  daily  for  Boston  by  way  of  the  New 

York  Central  svstem. 

«/ 


120 


Atlantic  and  St.  Lawrence  Railroad 

The  Atlantic  &  St.  Lawrence  extends  from  the  Cana¬ 
dian  line  at  Norton  Mills  through  Island  Pond,  Ver¬ 
mont,  thence  diagonally  across  New  Hampshire  just 
north  of  the  White  Mountains  into  Maine  to  tidewater 
at  Portland.  Over  this  line  the  Grand  Trunk  sends 
a  large  volume  of  grain  during  the  five  winter  months 
when  the  port  of  Montreal  is  closed  and  the  St.  Law¬ 
rence  unnavigable.  During  the  last  ten  years  grain 
shipments  via  the  Grand  Trunk  over  this  line  for  trans¬ 
shipment  to  ocean  steamers  at  Portland  have  been  as 
follows : 


Grain  Shipments  from  Portland 


Year 

Bushels 

1913 

12,635,868 

1914 

9,105,301 

1915 

15,772,374 

1916 

37,842,841 

1917 

12,171,779 

1918 

25,169,504 

1919 

29,527,000 

1920 

18,196,286 

1921 

18,290,116 

1922 

19,968,838 

This  is  an  important  tonnage  and  it  brings  many 
steamers  to  Portland  during  five  months  of  the  year. 
Considerable  other  freight  from  Canada  also  moves 
over  the  Grand  Trunk  system  to  Portland  for  trans¬ 
shipment  during  the  winter,  and  a  good  deal  of  import 
merchandise  flows  in  the  opposite  direction.  The  At- 


121 


lantic  &  St.  Lawrence  produced  206,851,000  ton  miles 
during  the  year  ending  December  31, 1922.* 

It  can  be  seen  that  this  line  is  of  great  importance 
to  the  city  of  Portland  and  the  State  of  Maine.  It 
constitutes  a  shorter  haul  for  the  Grand  Trunk  than 
to  any  other  available  winter  port.  Portland  by 
this  route  is  297  miles  from  Montreal.  The  Grand 
Trunk  maintains  a  westbound  differential  rate  from 
all  points  in  Maine  which  is  utilized  by  various 
industries  and  particularly  by  the  large  newsprint 
mills  to  reach  such  points  as  Detroit,  Chicago,  Mil¬ 
waukee,  the  Twin  Cities  and  other  western  points 
where  the  Maine  product  comes  into  competition  with 
newsprint  mills  located  outside  of  New  England. 

*  Appendix  P.  Revenue  Ton  Miles  and  Passenger  Miles,  Atlantic 
&  St.  Lawrence  Railroad,  1903-1922  (chart). 


122 


RUTLAND  RAILROAD 

This  road,  413  miles  in  length,  extends  from  Ogdens- 
burg,  N.Y.,  on  the  St.  Lawrence  River,  through  Rut¬ 
land,  Vermont,  to  Chatham,  N.Y.,  where  it  connects 
with  the  New  York  Central.  Its  passenger  trains,  how¬ 
ever,  run  to  Troy,  reaching  the  latter  point  by  trackage 
rights  over  a  portion  of  the  Boston  &  Maine.  From 
Rutland  it  has  a  branch  to  Bellows  Falls,  Vermont, 
where  it  connects  with  the  Cheshire  branch  of  the  Bos¬ 
ton  &  Maine  running  to  South  Ashburnham,  thence  via 
the  Fitchburg  main  line  to  Boston.  (Map  13.)  It  has 
87  locomotives,  115  passenger  cars,  2,289  freight  cars. 

It  produced  in  the  year  ending  December  31,  1922, 
201,641,162  revenue  ton  miles  and  43,572,947  passenger 
miles.* 

New  York  Central  owns  25.4  per  cent  of  the  stock  of 
the  Rutland  and  the  New  Haven  Railroad  also  owns 
25.4  per  cent,  so  that  these  roads  jointly  exercise  con¬ 
trol. 

Formerly  a  line  of  freight  boats,  the  Rutland  Transit 
Company,  owned  by  the  railroad,  connected  its  western 
terminal  on  the  St.  Lawrence  River  with  Chicago. 
Some  years  ago  the  Interstate  Commerce  Commission 
under  the  terms  of  the  Panama  Canal  Act  refused  per¬ 
mission  for  the  road  to  own  and  operate  these  steamers 
and  the  boats  were  discontinued.  Just  recently  a  line 
of  privately  owned  boats  has  been  put  on  between  Chi- 

*  Appendix  Q.  Revenue  Ton  Miles  and  Passenger  Miles,  Rutland 
Railroad,  1903-1922  (chart). 


123 


cago  and  Ogdensburg  in  connection  with  the  Rutland 
Railroad.  This  gives  during  the  months  of  open  lake 
navigation  a  differential  rail  and  lake  route  out  of  New 
England.  Freight  moving  from  Boston  via  this  route 
takes  the  Boston  &  Maine  to  South  Ashburnham,  thence 
over  the  Cheshire  Line,  a  good  single-track  line  but 
with  heavy  grades,  to  Bellows  Falls  where  the  connec¬ 
tion  is  made  with  the  Rutland.  This  route  has  never 
carried  a  large  volume  of  traffic. 

The  Rutland  operates  also  and  all  the  year  round 
all  rail  west  bound  differential  route  to  the  west  from 
New  England  via  either  the  Boston  &  Albany  or  the 
Boston  &  Maine  in  connection  with  the  Rome,  Water- 
town  &  Ogdensburg  Division  of  the  New  York  Central 
and  the  Michigan  Central. 

The  Rutland  is  a  small  road.  It  is  in  good  physical 
condition  and  distinctly  well  operated.  It  is  enough 
to  say  that  for  the  year  ending  June  30,  1922,  it  moved 
daily  78.4  per  cent  of  all  the  cars  ready  to  be  moved, 
and  for  the  six  months  ending  December  31,  1922,  it 
moved  80.0  per  cent.  This  route  naturally  attracts 
shippers  because  of  the  differential  advantage  and 
should  be  encouraged  especially  by  the  Boston  &  Maine 
system  because  the  traffic  leaves  the  main  line  of  the 
old  Fitchburg  Railroad  just  beyond  Fitchburg  and 
does  not  pass  through  the  Hoosac  Tunnel  or  over  the 
heavily  loaded  portion  of  the  Fitchburg  Railroad  west 
of  the  Connecticut  River. 


124 


CANADIAN  PACIFIC  RAILWAY 

The  Canadian  Pacific  extends  for  a  few  miles  into 
northern  Vermont  to  Newport  where  it  connects  with 
the  Boston  &  Maine  system.  Here  the  average  number 
of  loaded  cars  received  daily  from  the  Boston  &  Maine 
was  38  and  the  average  number  delivered  52. 

The  Canadian  Pacific  also  runs  east  and  west  across 
the  central  part  of  the  State  of  Maine  to  St.  John,  N.  B. 
It  brings  into  Maine  from  the  Province  of  New  Bruns¬ 
wick  and  to  a  less  extent  from  the  Province  of  Quebec 
a  considerable  tonnage  of  rough  and  semi-finished  for¬ 
est  products  which  are  converted  in  the  Maine  mills  and 
reshipped  to  various  points  in  and  out  of  New  England. 
This  is  an  increasing  traffic  of  considerable  advantage 
to  Maine  industries  and  our  New  England  railroads. 
This  road  picks  up  in  Aroostook  County  eight  or  nine 
thousand  carloads  of  potatoes.  The  Canadian  Pacific 
moves  these  potatoes  west  via  its  direct  line  across  the 
State  of  Maine,  also  in  connection  with  the  Maine  Cen¬ 
tral  and  other  New  England  lines  into  Canada  and 
then  completely  around  New  England  to  a  connection 
with  the  New  York  Central  Adirondack  Division, 
thence  the  New  York  Central  carries  them  to  New 
York  City. 


125 


PASSENGER  TRAFFIC  OF  NEW  ENGLAND 

ROADS 

The  substantially  higher  percentage  of  passenger 
train  miles  to  total  train  miles  in  New  England  is  one 
of  the  factors  which  adds  to  the  complexity  of  railroad 
operations  in  this  region,  especially  on  the  New  Haven, 
Boston  &  Albany  and  Boston  &  Maine. 

In  1922,  the  total  passenger  train  miles  on  New  Eng¬ 
land  railroads  were  31,302,000  compared  with 
20,644,000  freight  train  miles,  or  60  per  cent  of  the  total 
train  miles. 

For  the  United  States  as  a  whole,  the  passenger 
train  miles  were  530,197,000  as  compared  with 
554,780,000  freight  train  miles,  or  49  per  cent  of  the 
total. 

Revenues  from  passenger  traffic  on  the  railroads  in 
New  England  constitute  a  much  larger  proportion  of 
the  total  operating  revenues  than  on  the  railroads  of 
the  United  States  as  a  whole.  For  the  12  months  end¬ 
ing  December  31,  1922,  the  total  operating  revenues  of 
the  railroads  of  the  United  States  were  $5,617,252,656, 
of  which  $1,076,043,334,  or  19  per  cent,  were  from  pas¬ 
sengers.  In  New  England  out  of  total  operating  rev¬ 
enues  of  $288,961,226,  $91,963,353,  or  32  per  cent,  were 
from  passengers. 


126 


The  relation  of  the  passenger  revenues  to  total  oper¬ 
ating  revenues  on  the  different  New  England  railroads 
is  shown  in  the  following  table  (year  ending  December 
31, 1922)  : 


Total 

Passenger 

Per  Cent 
Passenger 
Revenue  to 

Revenues 

Revenue 

total  Revenues 

New  Haven  . 

.  $130,037,392 

$49,443,460 

38.02 

Boston  &  Maine . 

.  82,246,900 

23,154,242 

28.15 

Boston  &  Albany  . 

.  32,541,903 

10,719,049 

32.94 

Maine  Central  . 

.  20,387,172 

4,601,186 

22.57 

Rutland  . 

.  5,803,15S 

1,477,880 

25.47 

Central  Vermont  . 

* 

.  7,626,626 

1,207,452 

15.83 

Bangor  &  Aroostook  . . . 

.  7,437,216 

897,562 

12.07 

Atlantic  &  St.  Lawrence 

s  ....  2,880,859 

462,522 

16.06 

Total  New  England 

roads  $288,961,226 

$91,963,353 

31.83 

Total  United  States 

. $5,617,252,656 

$1,076,043,334 

19.16 

It  will  be  noted  that  on  the  New  Haven  the  revenue 
from  passengers  is  the  largest  percentage  of  total  rev¬ 
enues  (38.02)  of  any  of  the  New  England  railroads, 
Boston  &  Albany  (32.94)  and  Boston  &  Maine  (28.15) 
coming  next. 


Growth  of  Passenger  Traffic 

We  give  below  a  table  showing  the  revenue  passen¬ 
ger  miles  from  1903  to  1922  for  the  New  York,  New 
Haven  &  Hartford,  Boston  &  Albany,  Boston  &  Maine 
and  Maine  Central  Railroads. 


127 


These  four  roads  in  1922  produced  96  per  cent  of  the 
passenger  miles  in  New  England : 


Boston 

Boston 

Maine 

Year 

New  Haven 

&  Maine 

&  Albany 

Central 

1903  . 

1,123,327,000 

683,038,000 

252,055,000 

111,961,000 

1904  . 

1,145,051,000 

6S1,938,000 

247,710,000 

115,966,000 

1905  . 

1,184,346,000 

702,490,000 

254,879,000 

120,7SS,000 

1906  . 

1,268,319,000 

739,951,000 

264,263,000 

128,307,000 

1907  . 

1,383,997,000 

762,518,000 

281,541,000 

132,969,000 

190S  . 

1,413,626,000 

790, SOS, 000 

262,798,000 

138,432,000 

1909  . 

1,415,760,000 

792,427,000 

267,645,000 

136,326,000 

1910  . 

1,521,466,000 

864,871,000 

300,826,000 

142,224,000 

1911  . 

1,549,103,000 

862,473,000 

311,076,000 

144,672,000 

1912  . 

1,573,146,000 

880,742,000 

327,704,000 

161,342,000 

1913  . 

1,621,192,000 

904,059,000 

340,023,000 

168,640,000 

1914  . 

1,620,005,000 

896,081,000 

353,710,000 

161,051,000 

1915  . 

1,496,955,000 

849,949,000 

317,782,000 

138,902,000 

1916  . 

1,589,142,000 

798,695,000 

328,112,000 

144,416,000 

1917  . 

1,829,317,000 

926,966,000 

379,341,000 

159,775,000 

1918  . 

1,843,634,000 

882,382,000 

375,242,000 

153,393,000 

1919  . 

2,035,682,000 

976,112,000 

422,338,000 

170,618,000 

1920  . 

2,165,185,000 

1,041,735,000 

455,469,000 

168,146,000 

1921  . 

1,900,403,000 

876,113,000 

380,378,000 

134,991,000 

1922  . 

1,857,933,000 

847,361,000 

376,178,000 

128,431,000 

Per  cent  increase 

1912  over  1903 

40.0 

28.9 

30.0 

44.1 

1922  over  1912 

18.1 

(dec.)  3.8 

14.8 

(dec.)  20.4 

The  increase  in  passenger  miles  on  the  New  Haven 
during  the  period  1903-1922  has  been  steady  and  the 
percentage  of  increase  in  1922  over  1912,  was  18.1  per 
cent.  On  the  Boston  &  Maine  there  was  a  decrease  in 
1922  as  compared  with  1912  of  3.8  per  cent  and  a  de¬ 
crease  of  20.4  per  cent  on  the  Maine  Central.  The 
Boston  &  Albany  showed  an  increase  in  1922  of  14.8 
per  cent  over  1912. 

The  cause  for  the  falling  oft  in  the  passenger  busi¬ 
ness  on  the  Boston  &  Maine  and  Maine  Central  is  due 
in  large  measure  to  the  increased  use  of  the  automobile 
not  only  by  summer  residents  and  tourists  but  also  to 
a  large  extent  in  diminishing  local  traffic. 


128 


Commutation  Passenger  Traffic 

The  New  Haven,  Boston  &  Maine,  and  Boston  & 
Albany  handle  a  very  large  commutation  business. 
Por  the  year  1922  the  division  of  passenger  miles  and 
passenger  revenue  between  commutation  and  all  other 
passengers  is  given  in  the  following  table: 


All  Railroads 
of 

Passenger  Miles  United  States  New  Haven  B.  &  M.  B.  &  A. 
Commutation  ....  $6,131,607,000  $756,860,000  $351,286,000  $123,303,000 
Allother .  29,375,615,000  1,101,073,000  512,570,000  252,875,000 

Total .  $35,507,222,000  $1,857,933,000  $863,856,000  $376,178,000 


Per  cent  commutation 
to  total  passenger 


miles . 

17.27% 

Passenger  Revenue 

Commutation  .... 

$67,504,386 

All  other . 

1,007,757,837 

Total . 

Per  cent  commutation 
to  total  Passenger 

$1,075,262,223 

Revenue . 

6.28% 

Revenue  per  Passenger  Mile 

Commutation  .... 

$.01101 

All  other . 

Average  all  Passen- 

.03431 

gers . 

.03028 

40.7% 

40.6% 

32.8% 

$8,810,704 

40,632,756 

$4,343,402 

18,466,169 

$1,539,505 

9,179,545 

$49,443,460 

$22,809,571 

$10,719,050 

17.8% 

19.0% 

14.4% 

$.01164 

.03690 

$.01236 

.03603 

$.01249 

.03630 

.02661 

.02640 

.02849 

From  this  table  it  appears  that  commutation  pas¬ 
senger  traffic  produces  40.7%  of  the  total  passenger 
miles  on  the  New  Haven  and  but  17.8%  of  the  pas¬ 
senger  revenue;  on  the  Boston  &  Maine  40.6%  of  the 
total  passenger  miles  are  produced  by  commutation 
passengers  and  19%  of  the  passenger  revenue.  For 
the  Boston  &  Albany  the  commutation  business  is  some- 


129 


what  less  important,  producing  32.8%  of  the  total  pas¬ 
senger  miles  and  14.4%  of  the  passenger  revenue.  The 
revenue  received  by  each  of  these  roads  per  commuta¬ 
tion  passenger  mile  in  1922  was : 

New  Haven  $.01164 

Boston  &  Maine  .01236 

Boston  &  Albany  .01249 

Although  the  difference  in  average  rate  between  the 
New  Haven  and  Boston  &  Albany  seems  very  minute, 
yet  if  the  New  Haven  in  1922  had  realized  the  average 
Boston  &  Albany  rate  it  would  have  added  $643,331 
to  its  gross  passenger  income  last  year. 

We  believe  that  it  is  a  serious  question  whether  the 
commutation  traffic  is  today  paying  its  fair  share  of 
the  cost  of  the  transportation  service  rendered  by  these 
three  roads. 


Mail  and  Express 


In  addition  to  revenue  from  passenger  traffic,  pas¬ 
senger  trains  on  the  New  England  railroads  earn  sub¬ 
stantial  gross  revenues  by  carrying  mail  and  express. 

The  following  table  shows  the  revenue  from  mail 
and  express  on  the  New  England  railroads  for  the  cal¬ 
endar  year  1922 : 


New  York,  New  Haven  &  Hartford 

Boston  &  Maine  System  . 

Boston  &  Albany . 

Maine  Central  . 

Rutland  . 

Central  Vermont  . 

Bangor  &  Aroostook  . 

Atlantic  &  St.  Lawrence  . 


Mail 

Express 

.  .$1,523,311 

$4,961,182 

..  1,049,737 

3,049,491 

. .  770,074 

1,301,742 

. .  357,045 

672.545 

. .  127,473 

219, OSS 

. .  115,541 

189,805 

87,479 

109,166 

37,449 

43,436 

. .  $4,068,109 

$10,546,455 

Total 


130 


MOTOR  TRUCK  TRANSPORTATION 

Since  the  war  especially  the  motor  truck  has  be¬ 
come  of  great  importance  in  New  England  transporta¬ 
tion.  The  Committee  secured  the  services  of  Austin 
B.  Fletcher,  formerly  Chief  Engineer  of  the  Massa¬ 
chusetts  State  Highway  Commission,  and  until  re¬ 
cently  chief  engineer  of  the  Highway  Commission  of 
the  State  of  California,  to  investigate  the  problems 
relating  to  truck  transportation.  Mr.  Fletcher’s  re¬ 
port  shows  that  there  is  as  yet  a  dearth  of  reliable 
statistics,  either  as  to  tonnage  carried  by  trucks  or 
as  to  the  cost  of  operating  trucks. 

In  1922  there  were  660,845  automobiles  and  128,272 
trucks  registered  in  the  New  England  states.  Of  the 
trucks,  95,433  were  of  one  ton  or  less  capacity,  and 
11,615  were  of  three  tons  and  over. 

In  New  England  there  are  87,000  miles  of  highway 
outside  the  city  limits,  of  which  10,160  miles  are  now 
administered  by  the  state  highway  departments  of  the 
various  New  England  states.  Only  1,487  miles  of  these 
state  highways  have  been  improved  with  Class  A  sur¬ 
faces  (concrete  or  bituminous  macadam),  1,242  miles 
have  been  improved  with  Class  B  surfaces  (water 
bound  macadam),  6,169  miles  are  rated  as  Class  C 
roads,  being  surfaced  with  gravel  or  sand,  or  clay, 
or  merely  graded,  but  with  drainage  installed.  This 
statement  shows  that  the  New  England  states  have 
much  ahead  of  them  in  building  permanent  highways 
to  take  care  of  the  automobile  traffic  and  more  espe- 


131 


cially  of  the  heavy  trucks.  Since  the  inauguration  of 
state  highway  control  in  the  New  England  states  in 
1893  the  total  expenditure  for  construction,  and  for 
maintenance  and  reconstruction  of  state  highways  has 
been  $157,000,000,  of  which  $8,655,975  represents  the 
amount  received  as  Federal  aid,*  under  the  terms  of 
the  Federal  Road  Act. 

The  expenditures  of  the  New  England  states  for 
state  highways  have  shown  a  large  increase  during 
the  last  few  years. 

Average,  1915-1919  $9,152,988 

Expended,  1922  23,885,192 

This  total  of  $23,885,192  is  far  from  representing 
New  England’s  whole  highway  bill.  In  Massachusetts 
alone  it  is  estimated  that  the  expenditure  of  the  cities 
and  towns  upon  their  highways  is  in  excess  of 
$25,000,000  annually ;  so  that  if  the  cities  and  towns  of 
the  other  five  states  all  put  together  spend  half  as 
much  as  Massachusetts  our  total  annual  New  England 
highway  bill  is  running  at  $60,000,000  per  annum. 

The  annual  fees  for  the  heavier  trucks  in  Maine, 
Vermont,  Massachusetts  and  Connecticut  are  as  fol- 


lows : 

Maine  f 

Vermont 

Massachusetts  Connecticut 

Capacity 

3  ton  . 

, . .  $73.33 

$75.00 

$30.00 

$70.00 

4  ton  . 

. .  106.67 

100.00 

40.00 

137.50 

5  ton  . 

.  .  146.66 

125.00 

50.00 

187.50 

*  This  Federal 

aid  of  $8,655,975 

represents 

but  a  small 

part  of  the 

money  taken  throu 

gh  Federal  taxes 

from  New 

England  for 

Federal  road 

grants. 

-J-  in  Maine  trucks  on  pneumatic  tires  pay  25%  less  but  there  are 
probably  few  heavy  trucks  with  inflated  tires. 


132 


Rhode  Island  and  New  Hampshire  are  not  included 
above  as  fees  are  based  on  gross  weight  instead  of 
capacity,  but  in  these  two  states  the  average  fees  re¬ 
ceived  for  trucks  of  three  tons  or  more  in  1922  were: 


Rhode  Island  . $50.00 

New  Hampshire  . 121.41 


It  seems  quite  clear  that  in  Massachusetts,  at  least 
where  fees  for  trucks  of  3,  4,  and  5-ton  capacity  are 
only  $30-$40-$50,  respectively,  the  railroads  are  sub¬ 
ject  to  what  amounts  to  state  subsidized  truck  com¬ 
petition. 

If  a  five-ton  truck  is  permitted  to  roam  over  Class 
A,  B,  and  C  state  highways  for  a  week,  it  seems  quite 
clear  that  it  will  inflict  an  amount  of  wear,  tear  and 
damage  for  which  the  $1  it  pays  into  the  state  treasury 
is  no  compensatory  return.  In  one  week  in  the  spring 
when  the  frost  is  working  out  of  the  road  foundation 
much  more  damage  is  often  undoubtedly  done  than 
the  whole  year’s  fee  of  $50.00  can  repair. 

If  to  prevent  this  road  destruction  by  the  big 
trucks  the  Class  A  road  with  concrete  top  and  heavy 
supporting  foundation  is  built,  a  type  of  road  not 
needed  for  passenger  vehicles  and  light  trucks,  then 
the  state  is  furnishing  the  truck,  for  an  almost  nom¬ 
inal  consideration,  a  right  of  way  well  up  to  the  av¬ 
erage  expense  of  building  a  large  part  of  the  railroad 
mileage  of  this  country.  If  a  gasoline  tax  of  2  cents 
a  gallon  be  added  to  the  $50.00  yearly  fee  it  still  means 
undoubtedly  a  considerable  state  subsidy  for  the  truck. 
A  heavily  loaded  five-ton  truck  going  twenty-six  miles 
over  a  state  highway  from  Lowell  to  Boston  would  use, 


133 


■we  suppose,  five  or  six  gallons  of  gasoline,  which  would 
give  the  state  the  rather  nominal  sum  of  ten  or  twelve 
cents. 

We  are  not  arguing  either  for  or  against  the  present 
state  highway  policy  in  regard  to  trucks  but  merely 
pointing  out  that  for  the  movement  of  merchandise 
the  railroads  are  of  vastly  greater  importance  to  our 
industrial  welfare  than  trucks,  and  yet  we  are  play¬ 
ing  favorites.  We  are  speaking  harshly  to  our  oldest 
born,  on  whom  we  are  really  dependent,  and  at  the 
same  time  lavishing  caresses  on  our  youngest  born, 
whose  push  can  hardly  take  the  family  carriage  out 
of  the  door  yard. 


134 


NEW  ENGLAND  PORT  DEVELOPMENT 

Development  of  Water  Transportation 
Fundamental 

We  Lave  already  pointed  out  the  enormous  advan¬ 
tage  to  New  England  of  her  coast  line  and  the  excel¬ 
lent  harbors,  large  and  small,  dotted  along  the  coast, 
affording  good  protection  and  easy  access  to  the  sea, 
and  we  have  called  attention  to  the  fact  that  a  large 
part  of  our  population  live  immediately  adjacent  to 
the  sea  and  that  more  than  seventy  per  cent  of  our 
people  and  probably  a  larger  proportion  of  our  indus¬ 
tries  are  within  fifty  miles  of  the  seaboard. 

We  have  also  pointed  out  that  the  movement  through 
our  water  gateways  (26,158,573  tons  for  the  calendar 
year  1921)  comes  within  sight  of  balancing  the  all¬ 
rail  movement  through  our  rail  gateways,  which  for 
the  year  ending  June  30, 1922,  was  31,500,000  tons,  and 
that  the  doubling  of  the  cost  of  rail  transportation 
within  recent  years  has  greatly  increased  the  relative 
importance  to  New  England  of  her  location  by  the  sea. 

We  have  also  shown  that  the  opening  of  the  Panama 
Canal  has  brought  New  England  nearer  to  the  great 
and  flourishing  population  of  the  Pacific  Coast  than 
any  of  the  manufacturing  centers  in  the  Mississippi 
or  Ohio  valleys  or  on  the  Great  Lakes,  or  western  New 
York  or  western  Pennsylvania. 


135 

New  England  Railroads  Need  More  Export  Freight 

If  any  of  our  New  England  ports  like  Portland, 
Boston,  Providence  or  New  London  can  offer  increas¬ 
ing  advantages  which  will  attract  the  outgoing  grain, 
provisions,  or  other  commodities  of  the  states  be¬ 
yond  the  Hudson  and  incoming  merchandise  from 
overseas,  it  will  be  not  only  a  local  benefit  but  also  a 
help  in  sustaining  our  New  England  railroads.  “  Be¬ 
yond  to  beyond  ”  business  is  badly  needed.  Take  away 
from  any  of  the  other  ports  on  the  Atlantic  or  Gulf 
coasts  the  export  of  grain,  whether  New  York,  Phila¬ 
delphia,  Baltimore,  Norfolk,  New  Orleans  or  Galves¬ 
ton,  and  not  only  will  the  ports  be  badly  hurt  but  the 
railroads  back  of  them  will  see  their  revenues  mate- 
rialty  decreased. 

Bulk  cargo  for  outgoing  transatlantic  steamers  is 
today  critically  needed  to  sustain  the  port  of  Boston. 
One  of  the  large  transatlantic  lines  tells  us  that  they 
expect  shortly  to  make  Boston  merely  a  port  of  call 
for  their  incoming  steamers  en  route  to  New  York  or 
Baltimore,  and  another  long  established  transatlantic 
line  tells  us  they  are  having  the  utmost  difficulty  in 
maintaining  their  line  to  Boston  owing  to  the  impossi¬ 
bility  of  securing  return  cargoes; 

Undoubtedly  the  disabilities  of  some  of  our  railroads 
have  been  an  obstacle.  If  these  can  be  removed,  as 
we  have  no  doubt  they  can  if  New  England  decides  to 
face  the  problem,  there  still  remains  the  obstacle  pre¬ 
sented  by  the  lower  rates  for  export  grain  in  favor 
of  Baltimore  and  Philadelphia. 


136 


This  last  obstacle  may  be  removed  by  a  decision  of 
the  Interstate  Commerce  Commission  in  the  pending 
port  differential  case  permitting  our  New  England 
railroads  to  get  a  supporting  share  of  this  traffic. 

Enlargement  of  Welland  Canal 

We  are  advised  that  within  four  years  the  enlarge¬ 
ment  of  the  Welland  Canal,  connecting  Lake  Erie  with 
Lake  Ontario,  will  be  completed  so  as  to  permit  the 
standard  grain  carrying  boats  to  reach  Oswego  on  Lake 
Ontario,  and  somewhat  smaller  vessels  to  reach  Ogdens- 
burg  on  the  St.  Lawrence  Liver,  a  short  distance  below 
the  foot  of  Lake  Ontario. 

This  will  transfer  the  foot  of  the  Great  Lakes  from 
Buffalo  to  Oswego.  It  will  bring  much  traffic  to  Os¬ 
wego  which  will  be  121  miles  nearer  the  port  of  New 
York  than  Buffalo.  It  will  also  bring  the  big  lake 
carriers  at  Oswego  some  thirty  miles  nearer  to  Boston 
than  to  Baltimore.  Oswego  is  a  good  winter  port  and 
the  grain  which  remains  in  these  lake  carriers  at  the 
end  of  their  last  loaded  trip  to  Oswego  will  continue 
to  furnish  traffic  through  the  winter  months  just  as 
is  now  the  case  with  Buffalo. 

Four  years  from  now  export  grain  can  move  54  miles 
from  this  new  foot  of  the  lake  port,  Oswego,  by  the 
New  York,  Ontario  &  Western  to  its  junction  with  the 
West  Shore  or  New  York  Central  main  tracks  in  the 
Mohawk  valley,  then  122  miles  to  a  connection  with 
the  Boston  &  Albany,  or  97  miles  to  a  connection  with 
the  Boston  &  Maine  at  Rotterdam  Junction,  or  the 
grain  can  move  all  the  way  to  Rotterdam  Junction  or 


137 

Albany  by  New  York  Central  tracks  which  reach  Os¬ 
wego. 

When  the  enlargement  of  the  Welland  Canal  has 
been  completed  grain  can  move  by  water  also  to  Og- 
densburg  and  thence  over  the  Rutland  railroad  to  Bel¬ 
lows  Falls  and  so  by  the  Cheshire  and  Fitchburg  Divi¬ 
sion  of  the  Boston  &  Maine  to  the  Boston  elevators. 

This  Rutland  route  has  been  in  operation  for  many 
years  as  a  lake  and  rail  route  for  general  merchandise 
moving  to  or  from  New  England.  The  Rutland  rail¬ 
road  used  to  be  more  active  in  carrying  traffic  back 
and  forth  between  New  England  and  the  West  when 
it  owned  and  operated  its  own  lake  steamers  but  after 
the  passage  of  the  Panama  Canal  Act  the  Rutland  was 
obliged  to  sell  its  steamers.  A  separately  owned  line 
of  steamers  has  been  put  on  within  a  few  weeks  but  it 
is  hoped  this  old  New  England  lake  route  may  again 
be  restored  to  full  vigor  by  permitting  the  Rutland 
to  operate  as  the  water  extension  of  its  line  its  own 
dependable  and  closely  coordinated  steamers.  Expe¬ 
rience  seems  to  have  demonstrated  that  cutting  oft  the 
Rutland  steamers  benefited  no  one  except  possibly  the 
New  York  Central  and  that  to  an  entirely  negligible, 
extent. 

The  Rutland  railroad  is  in  good  condition  and  when 
the  Welland  Canal  has  been  enlarged  it  is  hoped  this 
Lake-Rutland-Boston  &  Maine  route  can  be  utilized 
to  feed  the  port  of  Boston  a  limited  perhaps,  but  at 
any  rate,  a  dependable  flow  of  grain. 


138 


Advice  of  Expert  ox  Port  Development 

This  Committee  has  not  felt  it  could  undertake  a 
detailed  study  of  the  New  England  ports,  but  owing 
to  the  interlocking  of  our  ports  and  railways  it  sought 
the  advice  of  Mr.  Frederick  W.  Cowie  of  Montreal. 
Mr.  Cowie  is  an  engineer  who  for  many  years  has  de¬ 
voted  himself  to  the  study  of  port  development.  He 
is  familiar  by  study  on  the  ground  with  the  principal 
ports  of  Europe  and  this  country.  He  has  been  fre¬ 
quently  called  in  as  a  consulting  engineer  and  port 
expert  in.  regard  to  various  ports  in  this  country.  He 
was  already  quite  familiar  with  the  port  of  Boston. 
The  development  of  the  present  great  port  of  Mont¬ 
real  from  a  port  of  limited  facilities  and  unimportant 
traffic  sixteen  years  ago  to  a  port  of  first-class  modern 
facilities  which  last  year  exported  153  million  bushels 
of  grain,  has  been  under  his  immediate  direction. 
Moreover,  until  his  resignation  a  short  time  ago,  he  has 
been  in  active  operating  charge  of  these  facilities  at 
Montreal.  They  have  been  constructed  with  the  aid 
of  public  credit,  but  they  have  at  all  times  proved 
profitable  and  borne  all  expense  of  operation,  upkeep, 
interest  upon  borrowed  money,  and  sinking  funds  for 
the  retirement  of  the  debt. 

Mr.  Cowie  visited  Portland,  Boston,  Providence  and 
New  London. 


Portland 

He  reported  the  large  volume  of  grain  brought  to 
Portland  by  the  Grand  Trunk  during  the  winter 


139 


months,  furnishing  the  bulk  of  Portland’s  across-sea 
traffic,  as  flowing  smoothly  and  economically.  The  two 
Grand  Trunk  elevators  at  Portland  have  a  holding- 
capacity  of  more  than  two  million  bushels  and  can 
unload  promptly  two  hundred  cars  in  a  day.  The  new 
state  pier  just  completed,  constructed  at  a  cost  to  the 
state  of  approximately  $2,000,000,  constitutes  a  notable 
addition  to  Portland’s  port  facilities  and  seems  to  pro¬ 
vide  adequately  for  all  traffic  now  in  sight. 

Portland  has  as  deep  a  harbor  (35  ft.)  as  any  port 
on  the  Atlantic  Seaboard  with  but  one  exception;  the 
entrance  to  the  harbor  is  along  a  well  defined  channel 
running  in  a  nearly  straight  line,  making  it  easily 
accessible  and  nearer  Europe  than  any  other  Atlantic 
port. 

Providence 

Providence  harbor  is  27  miles  from  the  open  sea 
with  a  channel  600  feet  wide  and  30  feet  of  water  at 
low  tide.  It  reaches  the  heart  of  Rhode  Island’s  manu¬ 
facturing  area.  The  State  of  Rhode  Island  has  built 
a  modern  well-equipped  pier  and  the  city  of  Provi¬ 
dence  has  also  constructed  a  pier  and  has  under  way 
further  port  developments.  The  State  of  Rhode  Island 
has  spent  $667,604  on  the  development  of  the  port 
and  the  City  of  Providence  $867,747  and  the  Federal 
Government  $3,266,393. 

In  gross  tonnage,  foreign  and  coastwise,  the  port 
of  Providence  ranks  second  to  Boston  in  New  Eng¬ 
land.  Unlike  Portland  or  Boston,  its  foreign  com¬ 
merce  is  not  large  except  for  a  large  tonnage  of  fuel 
oil  from  Mexico. 


140 


Providence  is  served  by  the  Fabre  Line  with  direct 
sailings  to  Marseilles,  Genoa,  Naples  and  other  Med¬ 
iterranean  ports. 

The  coastwise  movement  of  coal  is  heavy  and  there 
are  numerous  coastwise  lines  serving  the  great  indus¬ 
trial  district  of  which  Providence  is  the  center.  There 
are  three  lines  between  Providence  and  New  York  and 
the  Merchants  and  Miners  Transportation  Company 
gives  service  to  Philadelphia,  Norfolk  and  Baltimore. 
The  port  of  Providence  is  well  equipped,  having  a 
large  number  of  private  piers  in  addition  to  the  state 
pier  and  the  municipal  pier,  and  the  city  has  recently 
appropriated  $500,000  for  further  improvements. 

New  London 

New  London  has  an  excellent  natural  harbor  and 
the  State  of  Connecticut  has  built  a  modern  pier  which 
is  already  self-supporting.  Further  development,  in¬ 
cluding  a  grain  elevator  and  additional  piers,  are  being 
projected.  New  London  has  three  lines  to  New  York, 
— one  maintained  by  the  New  England  Steamship 
Company  (a  subsidiary  of  the  New  Haven  railroad), 
the  Thames  River  Line,  and  the  Central  Vermont 
Steamship  Company,  a  part  of  the  Grand  Trunk  rail¬ 
road’s  transcontinental  service,  giving  that  system  its 
access  to  New  York  City. 

Modern  Port  Development 

A  modern  port  should  be  developed  and  organized 
along  the  line  of  any  modern  industrial  machine.  In 
a  manufacturing  plant  putting  things  on  the  floor  to 


141 


pick  them  up  again  gets  you  nowhere  and  is  a  sign  of 
senescence  in  the  management.  If  the  man  operating 
the  tool  has  to  stoop  to  the  floor  or  in  fact  “reach”  in 
any  direction  for  the  next  piece  it  may  easily  increase 
the  cost  of  the  operation  ten  or  twenty  or  thirty  per 
cent  and  destroy  all  chance  of  profit. 

Just  so  with  the  industrial  machinery  of  a  port.  The 
port  facilities  should  permit  a  car  of  incoming  grain, 
no  matter  by  what  railway  it  arrives,  to  reach  any 
grain  elevator  serving  the  port  by  the  simplest  possible 
switching  movement  in  hardly  more  than  minutes  of 
time  rather  than  hours  or  the  days  sometimes  now  re¬ 
quired.  With  a  modern  grain  elevator  a  car  can  be  un¬ 
loaded  in  ten  minutes  and  a  train  in  a  few  hours  and 
then  the  empty  cars  started  back  for  the  next  load. 
With  merchandise  the  same  principles  apply  except 
that  the  cars  of  merchandise  arriving  at  the  different 
rail  heads  are  not  destined  for  one  or  two  points  on 
the  water  front  but  in  the  ideal  port  should  be  able  to 
move  promptly  and  easily  along  the  whole  water  front 
to  the  receiving  shed  directly  opposite  the  desired 
steamer. 

This  is  the  whole  story  of  the  ideal  port.  In  New 
York  an  immense  amount  of  lightering  is  performed 
and  considerable  trucking  to  connect  the  rail  heads 
with  the  individual  steamers.  This  does  not  represent 
an  ideal  arrangement  at  all  but  only  an  enormous  bill 
for  connecting  the  rail  heads  with  the  ship  side,  levied 
upon  the  tonnage  passing  through  the  port  of  New 
York.  The  enormous  amount  of  trucking  in  New  York 
to  take  local  merchandise  to  the  steamer  side  and  the 
long  lines  of  trucks  waiting  at  the  ferries  for  passage 


142 


to  Brooklyn,  Jersey  City  or  Hoboken  also  present  a 
striking  picture  of  port  facilities  not  to  be  classed 
perhaps  as  bad,  but  ten  thousand  miles  short  of  the 
ideal. 

Boston 

Since  1859  the  Commonwealth  of  Massachusetts  has 
expended  in  the  development  of  the  port  of  Boston 
$20,164,125.*  During  the  war  the  government  built  the 
Army  Base  at  South  Boston  at  a  cost  of  approxi¬ 
mately  $26,000,000.  The  Commonwealth  also  has  built 
within  recent  years  the  Commonwealth  Pier.  Both  of 
these  great  piers  constitute  sound  and  useful  additions 
to  the  port  facilities  of  Boston.  The  Commonwealth 
Pier  has  been  utilized  to  its  capacity  during  the  last 
year  and  also  the  large  portion  of  the  Army  Base  Pier 
not  reserved  by  the  government  for  its  own  use. 

It  has  been  stated  by  many  who  have  studied  the 
development  of  the  port  of  Boston  that  there  should 
be  a  connecting  railroad  built  outside  of  the  city  limits. 

The  Cowie  Plan 

Now  turning  to  the  plan,  presented  to  us  by  Mr. 
Cowie  which  it  is  proper  to  say  he  describes  as  the 
result  of  a  reconnaissance,  as  he  was  able  only  to  de- 

i 

vote  a  little  over  two  weeks  to  his  study,  it  will  be 
found  that  it  is  so  simple  that  the  map  makes  it  easily 
understood.  (Map  16.) 

The  center  of  Boston’s  present  port  activities  Mr. 
Cowie  has  pointed  out  is  where  the  Charles  and  Mystic 

*  Appendix  R.  Expenditures  of  Commonwealth  of  Massachusetts  on  Port 
of  Boston  1859-1922. 


143 


Rivers  coming  together  make  the  inner  harbor.  The 
old-fashioned  wharves  along  the  front  of  the  city 
proper,  which  are  too  short  for  large  steamers,  he 
proposes  to  fill  in  to  a  line  drawn  along  the  outer  edge 
of  the  piers,  bulkheading  this  line  so  that  steamers  will 
come  alongside  and  not  enter  a  slip. 

Then  starting  from  the  big  terminals  in  South  Bos¬ 
ton,  constituting  the  rail  heads  of  the  New  Haven 
Railroad  and  the  Boston  &  Albany,  he  proceeds  with 
a  double  track  railroad  crossing  Fort  Point  channel 
and  thence  along  the  new  land  created  by  the  filling  in 
of  the  old  wharves,  then  crossing  the  Charles  to  a  point 
where  connection  is  established  with  the  rail  heads  of 
the  Boston  &  Maine  system,  including  the  old  Fitch¬ 
burg,  Boston  &  Maine,  Boston  &  Lowell  and  Eastern 
Divisions,  then  back  of  the  Navy  Yard  upon  a  raised 
structure  to  the  big  Mystic  Wharf  terminal  of  the 
Boston  &  Maine  system  where  rail  connection  is  again 
established;  thence  across  the  Mystic  River  through 
a  corner  of  Chelsea,  and  so  along  the  water  front  of 
East  Boston  where  there  is  ample  opportunity  for  as 
many  large  piers  as  the  port  may  require  for  many 
years.  Then  along  the  base  of  the  present  East  Boston 
piers  of  the  Albany  Railroad  to  a  connection  with 
the  Grand  Junction  Railway  and  picking  up  any  traffic 
which  may  come  by  the  Eastern  Division  of  the  Boston 
&  Maine  directly  to  East  Boston,  and  establishing  con¬ 
nection  with  the  present  East  Boston  freight  yard  of 
the  Boston  &  Albany  and  the  East  Boston  freight  yard 
of  the  Boston  &  Maine  system  on  the  eastern  side  of 
East  Boston. 

Mr.  Cowie  has  pointed  out  also  that  by  means 


144 


of  an  elevated  structure  a  wide  new  motor  roadway 
circling  the  port  of  Boston  can  well  be  constructed  over 
this  new  belt  line.  Besides  the  two  main  tracks  it  will 
be  advisable  to  construct  four  tracks  over  portions  of 
this  route. 

This  development  is  further  illustrated  by  a  cross 
section  of  the  city  proper  water  front.  (Map  17.) 
This  shows  a  steamer  in  position  alongside  the  bulk¬ 
head,  then  the  receiving  and  collecting  warehouse 
which  should  he  established  always  for  the  temporary 
storage  of  cargo  arriving  and  the  collection  of  cargo 
for  a  ship  due.  Then  comes  the  railway  with  switch 
tracks  leading  directly  into  the  receiving  and  collect¬ 
ing  warehouse,  and  overhead  is  the  truck  roadway  feed¬ 
ing  into  the  second  story  of  the  receiving  and  collecting 
warehouse.  Next  will  come  such  permanent  ware¬ 
houses  as  the  port  may  need  and  it  shall  seem  desirable 
to  construct  either  with  private  capital  or  probably 
better  built  by  port  trustees  and  leased.  Next  comes 
Atlantic  Avenue. 

It  will  he  seen  that  Mr.  Cowie’s  plan  does  away  en¬ 
tirely  with  any  necessity  for  the  enormously  expensive, 
both  to  build  and  to  operate,  proposed  new  belt  rail¬ 
way  outside  of  Boston. 

Mr.  Cowie’s  plan  joins  all  the  existing  rail  heads  of 
our  railroads  serving  Boston;  it  permits  a  car  to  be 
shifted  almost  in  a  few  minutes  from  any  rail  head  to 
the  existing  grain  elevators,  or,  if  containing  merchan¬ 
dise,  into  the  receiving  warehouse  directly  opposite  the 
desired  steamer.  It  also  permits  merchandise  handled 
by  truck  to  run  up  one  of  the  inclines  or  ramps  of  the 
overhead  roadway  and  deliver  its  merchandise  directly 


145 


into  the  receiving  warehouse  right  opposite  the  desired 
steamer.  It  brings  the  business  of  the  port  close  to  the 
city,  the  custom  house,  and  the  business  of  the  city  with 
which  it  necessarily  has  many  relations. 

The  elevated  roadway  can  be  built  wide  enough  to 
furnish  Boston  with  a  new  circular  motorway,  and  the 
advantages  of  this  are  so  obvious  that  they  do  not 
need  explanation. 

Necessity  for  Coordination  of  Boston  Terminals 

Our  advices  are  that  at  present  there  is  a  lack  of 
cooperation  in  the  service  of  the  port  or  perhaps  it  is 
fairer  to  call  it  coordination  between  our  different  rail¬ 
roads.  A  steamer  expecting  cargo  by  different  rail¬ 
roads  today  is  seriously  delayed  and  embarrassed  by 
this  lack  of  coordination. 

If  the  people  of  Massachusetts  prefer  a  meat  diet  to 
gruel,  and  intend  to  take  hold  of  their  chief  port  in 
a  vigorous,  constructive  manner,  we  suggest  they 
should  go  further  than  the  above  plan.  All  port  ex¬ 
perience  here  and  the  world  over  indicates  that  for  the 
proper  development  of  a  modern  port  there  should 
be  one  general  unified  terminal  control.  It  follows 
from  this  that  all  the  railroad  property  within  a  certain 
radius  from  the  center  of  the  city,  as  illustrated  by 
map  16,  should  be  taken  over  by  terminal  trustees 
backed  by  state  credit. 

These  trustees  would  necessarily  attack  the  problem 
presented  by  the  four  separate  antiquated  freight 
yards  of  the  Boston  &  Maine  Bailroad  and  from  time 
to  time  upon  a  conservative  program  carry  out  other 


146 


plans  for  the  improvement  of  the  Boston  terminals. 
This  unified  terminal  plan  would  also  have  the  advan¬ 
tage  resulting  from  the  purchase  of  these  terminal  prop¬ 
erties  of  providing  a  substantial  fund  for  each  of  our 
existing  railroads  to  be  expended  under  some  form  of 
public  control,  referred  to  later,  for  the  purchase  of 
locomotives  or  for  other  capital  needs  of  public  concern. 


147 


TENTATIVE  CONSOLIDATION  PLAN  OF  THE 
INTERSTATE  COMMERCE  COMMISSION 

The  consolidation  section  of  the  Transportation  Act 
of  1920  requires  the  Interstate  Commerce  Commission 
to  set  up  a  tentative  plan  for  the  consolidation  of  the 
railroads  of  this  country  into  “  a  limited  number  of 
systems.”  In  accordance  with  this  mandate  the  Com¬ 
mission  in  August,  1921,  issued  a  tentative  plan  for 
consolidating  the  railroads  into  nineteen  systems  (No. 
12964;  63  I.C.C.  455).  As  an  appendix  to  the  tentative 
plan  the  Commission  published  the  report  of  Professor 
William  Z.  Ripley,  of  Harvard  University,  who  had 
been  engaged  to  make  a  study  of  possible  consolida¬ 
tions.  Following  the  publication  of  its  tentative  plan, 
the  Commission  in  accordance  with  the  provisions  of 
the  statute  has  held  numerous  hearings  in  Washington 
and  elsewhere,  at  which  the  carriers  and  others  inter¬ 
ested  have  appeared.  Further  hearings,  including 
probably  one  or  more  in  New  England,  are  to  be  held 
in  different  parts  of  the  country.  At  the  conclusion 
of  the  hearings  the  statute  lays  upon  the  Commission 
the  duty  to  suggest  a  plan  for  consolidation  of  the  rail¬ 
way  properties  of  the  country. 


Alternative  Newt  England  Plans 

In  its  tentative  plan  the  Commission  assigns  the  Bos¬ 
ton  &  Maine,  Maine  Central,  Bangor  &  Aroostook,  as 
well  as  the  Rutland,  to  the  New  York  Central,  System 


148 


No.  1,  and  the  New  Haven,  including  the  Central  New 
England,  to  the  Baltimore  &  Ohio,  System  No.  3.  In 
making  these  suggestions  the  Commission  says,  “  Pro¬ 
fessor  Ripley  rejects  the  trunk  line  treatment  of  the 
New  England  roads,  but  we  present  this  alternative 
with  a  view  to  developing  the  situation  upon  hearing.  ’  ’ 

The  arrangement  suggested  by  the  Commission  in 
place  of  the  trunk  line  alternative,  is  a  consolidation 
of  the  New  England  roads  named  above  (except  the 
Rutland)  together  with  the  New  York,  Ontario  &  West¬ 
ern,  and  two  small 1  ‘  bridge  lines,  ’  ’  the  Lehigh  &  Hud¬ 
son  River  and  the  Lehigh  &  New  England,  the  entire 
group  being  designated  as  “System  No.  7  —  New 
England.” 

Besides  the  suggested  trunk  line  alternative,  the 
Commission  submits  a  further  alternative  to  “  System 
No.  7  —  New  England  ”  by  adding  to  the  group  of  roads 
named  in  that  system  the  Delaware  &  Hudson,  the  Ul¬ 
ster  &  Delaware,  the  Delaware,  Lackawanna  &  West¬ 
ern,  the  Buffalo,  Rochester  &  Pittsburgh,  the  Pitts¬ 
burgh  &  Shawmut,  and  the  Pittsburgh,  Shawmut  & 
Northern,  this  alternative  and  enlarged  group  being 
called  “System  No.  7  A — New  England-Great  Lakes.” 

To  the  peculiar  conditions  and  problems  of  the  New 
England  situation,  Professor  Ripley  devotes  his  entire 
Chapter  II  (63  I.C.C.,  509)  of  his  report  to  the  Com¬ 
mission.  He  first  takes  up  for  consideration  a  trunk 
line  consolidation  for  the  New  England  railroads,  and 
proposes  that  the  Boston  &  Albany  shall  remain  as  part 
of  the  New  York  Central  system. 

He  then  considers  various  suggestions  for  turning 
over  the  New  Haven  system,  south  of  the  Boston  & 


149 


Albany,  to  some  trunk  line,  and  then  similar  sugges¬ 
tions  for  turning  over  the  Boston  &  Maine  and  other 
New  England  roads,  north  of  the  Boston  &  Albany,  to 
some  other  trunk  line. 

Treatment  of  the  New  Haven  under  Trunk 

Line  Plan 

Of  the  three  plans  considered  by  him  for  consolidat¬ 
ing  the  New  Haven  railroad  with  either  the  Pennsyl¬ 
vania,  the  Baltimore  &  Ohio  (map  18),  or  a  new  trunk 
line  system  to  be  created  by  joining  the  Lackawanna  & 
Nickel  Plate,  Professor  Ripley  seems  to  prefer,  if  there 
is  to  be  a  consolidation  of  the  New  England  railroads 
with  the  trunk  lines,  joining  the  New  Haven  to  the 
Baltimore  &  Ohio.  We  can  hardly  agree  with  this. 
This  consolidation  is  also  the  Commission’s  trunk  line 
alternative  “System  No.  3  —  Baltimore  &  Ohio.” 

Comparison  between  Allocating  the  New  Haven  to 
(1)  the  Baltimore  &  Ohio  or  (2)  the  Pennsylvania 

The  greatly  predominant  interchange  of  traffic  be¬ 
tween  the  New  Haven  and  the  trunk  line  systems  is 
with  the  Pennsylvania.  This  is  not  simply  a  railroad 
matter;  it  means  that  the  New  England  people  and  the 
people  served  by  the  Pennsylvania  system  have  found 
that  under  economic  conditions  and  the  inherent  es¬ 
sence  of  things  as  they  actually  exist,  they  have 
business  interests  in  common.  No  arbitrary  consoli¬ 
dation  between  the  New  Haven  and  the  Baltimore 
&  Ohio  system  will  change  this  state  of  affairs.  The 
traffic  interchange  between  the  people  reached  by 


150 


the  New  Haven  system  and  the  people  served  by 
the  Baltimore  &  Ohio  is  relatively  small.  If  there 
is  to  be  a  trunk  line  consolidation  with  the  New 
Haven  system,  the  existing  current  and  movement  of 
merchandise  point  inevitably  to  the  Pennsylvania  sys¬ 
tem.  To  consolidate  the  New  Haven  with  the  Balti¬ 
more  &  Ohio  would  seem  to  fail  to  carry  out  a  declared 
intention  of  the  Transportation  Act  which  provides 
that  “Wherever  practicable  the  existing  routes  and 
channels  of  trade  and  commerce  shall  be  maintained.” 
These  words  not  only  express  a  clear  direction  inserted 
in  the  Act  but  they  express  a  sound  principle  to  be 
observed  in  regard  to  consolidation  of  different  rail¬ 
roads. 


Coal  Movement 

Professor  Ripley  speaks  of  the  rich  coal  fields  tribu¬ 
tary  to  the  Balthnore  &  Ohio  system.  The  Balti¬ 
more  &  Ohio  railroad  does  not  serve  the  hard  coal 
fields  of  Eastern  Pennsylvania.  It  touches  the  Somer¬ 
set  County  and  Connellsville  bituminous  coal  district  of 
Western  Pennsylvania,  but  no  hard  coal  and  compara¬ 
tively  little  soft  coal  reaches  New  England  all  rail  by 
way  of  the  Baltimore  &  Ohio  from  these  Pennsylvania 
fields.  New  England  does  take  a  large  tonnage  of 
bituminous  coal  from  Pennsylvania,  but  the  coal 
mainly  moves  to  New  England  over  the  Pennsylvania 
and  New  York  Central  railroads.  The  Baltimore  & 
Ohio,  therefore,  plays  but  a  minor  and  unimportant 
part  in  the  movement  of  all  rail  coal  to  New  Eng¬ 
land. 

Taking  up  now  the  rich  fields  of  West  Virginia 


151 


where  the  Pocahontas,  New  River,  Fairmont,  Ka¬ 
nawha,  and  other  justly  celebrated  steam  coals  are  to 
be  found,  these  fields  ship  a  very  heavy  tonnage  of  coal 
to  New  England  for  our  railroads,  public  utilities, 
manufacturers  and  other  consumers  of  steam  coal. 
They  are  an  important  and  steadily  growing  source  of 
supply ;  but  the  coal  moves  and  should  continue  to  move 
practically  wholly  by  the  tidewater  routes,  first  by  rail 
down  to  the  seaboard  at  Hampton  Roads  or  from  the 
Fairmont  field  to  Baltimore,  Philadelphia  or  New 
York  where  the  coal  is  dumped  into  vessels  and  is 
transported  to  New  England.  The  Baltimore  &  Ohio 
takes  part  in  this  tidewater  movement  by  bringing  to 
ship  side  at  Baltimore  a  large  amount  of  coal  destined 
for  New  England. 

The  Baltimore  &  Ohio  all  rail  route  to  New  England 
from  the  West  Virginia  field  is  via  the  Shippenburg 
gateway,  then  to  Harrisburg,  then  east  to  Easton, 
Pennsylvania,  then  over  the  Lehigh  &  Hudson  River 
railroad  to  the  New  Haven  gateway  at  Maybrook.  This 
is  a  long,  circuitous,  expensive  rail  route. 

A  car  loaded  in  the  West  Virginia  field  of  the  Balti¬ 
more  &  Ohio  for  a  New  England  destination  prob¬ 
ably  requires  on  the  average  a  month  to  make  the 
round  trip  and  in  winter  usually  considerably  longer. 
By  this  route  the  average  coal  car  would  probably 
make  less  than  three  round  trips  during  the  four 
months  of  winter. 

Pennsylvania  and  the  adjoining  states  of  New  Jersey 
and  New  York  are  states  of  immense  industrial  activ¬ 
ity  and  are  inevitably  going  to  need  a  constantly  rising 
percentage  of  the  near-by  Pennsylvania  coal.  New 


152 


England  must  look  more  and  more  to  the  West  Vir¬ 
ginia  water-borne  coal. 

A  car  loaded  with,  coal  on  the  Virginian  railway, 
Chesapeake  &  Ohio  or  the  Norfolk  &  Western,  which 
all  directly  tap  these  Southern  West  Virginia  fields, 
reaches  one  of  the  Hampton  Roads  ports  probably  on 
the  average  in  three  days.  At  the  steamer  pier  the  car 
is  turned  upside  down  and  the  coal  dumped  into  the 
hold  of  a  New  England  vessel  and  the  car  returns  im¬ 
mediately  to  the  mines.  This  is  a  shuttle  movement 
on  these  railroads  especially  designed,  equipped  and 
operated  to  facilitate  the  tidewater  coal  movement  and 
unencumbered  with  any  large  volume  of  general  mer¬ 
chandise.  It  takes  a  collier  but  a  few  hours  to  load 
and  only  a  limited  number  of  days  or  rather  hours  to 
reach  its  New  England  destination,  whether  it  be  Provi¬ 
dence,  Fall  River,  New  Bedford,  Boston,  Beverly, 
Portsmouth,  Portland,  or  Searsport.  As  the  major 
portion  of  the  coal  consumption  in  New  England  is  on 
the  sea  front  or  close  by,  the  time  consumed  at  the  New 
England  end  for  rail  transportation  is  either  nothing 
or  represents  a  minimum  haul.  It  is  of  significance 
that  three  new  public  utility  power  plants  of  large 
capacity  are  now  in  process  of  erection  on  tidewater, 
—  the  Connecticut  Light  and  Power  Company  at 
Devon,  the  Hartford  Electric  Light  Company  at  Hart¬ 
ford,  and  the  great  new  power  plant  of  the  Boston 
Edison  Company  at  Weymouth.  These  plants  all 
expect  to  use  West  Virginia  water-borne  coal  and 
will  transmit  their  power  derived  from  this  coal 
farther  and  farther  back  from  the  shore  line. 
This  development  is  of  great  economic  importance.  It 


153 


will  probably  lead  to  a  material  reduction  in  the 
size  of  New  England’s  coal  bill. 

New  England  (map  19)  was  constantly  advised  dur¬ 
ing  the  war,  when  economy  in  the  use  of  cars  and  trans¬ 
portation  was  of  national  moment,  that  it  was  almost  a 
crime  to  try  to  get  coal  from  the  West  Virginia  fields 
to  New  England  by  the  all-rail  route.  It  may  not  ap¬ 
proach  a  crime  today  but  it  remains  a  slow,  wasteful 
method  of  transporting  coal  to  New  England. 


Comparative  New  Haven  Interchange  with 
Pennsylvania  and  Baltimore  &  Ohio 

The  daily  interchange  of  cars  between  the  New 
Haven  railroad  and  the  Pennsylvania  system  via  the 
Hell  Grate  bridge  route,  jointly  owned  by  the  Pennsyl¬ 
vania  and  New  Haven,  amounted  to  an  average  of  589 
loaded  cars  a  day  during  1922 — by  far  its  largest  inter¬ 
change  with  any  connecting  road.  Besides  this  the 
New  Haven  receives  at  Maybrook  a  limited  tonnage 
originating  on  the  Pennsylvania  railroad. 

The  number  of  cars  interchanged  between  the  New 
Haven  and  the  Baltimore  &  Ohio  system  is  difficult 
to  obtain  because  the  New  Haven  has  no  physical  con¬ 
nection  with  the  Baltimore  &  Ohio  system.  However, 
the  President  of  the  New  Haven  submitted  a  statement 
of  a  Typical  Day’s  Interchange  in  detail  which  showed 
that  on  Oct.  18,  1922  (the  day  selected  as  typical),  the 
New  Haven  received  forty-six  loaded  cars  originating 
on  the  Baltimore  &  Ohio  and  delivered  forty-seven  for 
destinations  on  the  Baltimore  &  Ohio.  The  interchange 
of  the  New  Haven,  therefore,  with  the  Pennsylvania, 


154 


is  clearly  many  times  the  interchange  between  the 
Baltimore  and  Ohio  and  the  New  Haven. 

The  main  interchanges  of  the  New  Haven  with  lines 
west  of  the  Hudson  River  for  the  year  ending  June 
30,  1922,  counting  movement  both  ways,  were  (in  car¬ 
loads  and  empties) : 


Loaded  Total 


Cars  Cars 

Pennsylvania  .  214,942  336,271 

Lehigh  &  Hudson  River  .  101,110  155,832 

Lehigh  Valley  .  63,107  104,327 

Erie  .  60,067  105,072 

Central  Railroad  of  New  Jersey  .  55,078  82,673 

Lehigh  &  New  England .  29,587  60,272 

New  York  Central  .  13,822  37,042 

New  York,  Ontario  &  Western  .  15,053  26,563 

Long  Island  .  14,715  23,821 

New  York  Terminal  Companies  .  16,437  19,154 


Total  583,918  951,027 


Consolidation  with  Baltimore  &  Ohio  neither 

Logical  nor  Natural 

As  a  through  connection  for  the  New  Haven  system 
to  Chicago  the  Baltimore  &  Ohio  route  would  be  105 
miles  longer  than  the  Pennsylvania  route. 

The  historical  and  natural  port  constituting  now  and 
always  the  focus  of  the  Baltimore  &  Ohio ’s  deep  water 
activity  is  Baltimore.  As  compared  with  Baltimore  its 
relation  to  the  port  of  New  York  has  always  been  in¬ 
cidental  and  unimportant,  and  to  try  and  force  the  in¬ 
terests  and  activity  of  the  Baltimore  &  Ohio  manage¬ 
ment  still  further  east  beyond  the  port  of  New  York 
into  New  England  seems  to  us  unlikely  to  be  a  virile 


success. 


155 


It  is  true  that  the  tentative  plan  of  the  Commission 
suggests  that  the  proposed  Baltimore  &  Ohio  system 
shall  be  augmented  by  the  addition  of  the  Philadelphia 
&  Reading  and  Central  Railroad  of  New  J ersey .  Both  of 
these  roads  interchange  with  the  New  Haven,  although 
in  the  case  of  the  Philadelphia  &  Reading  there  is  no 
direct  connection,  the  freight  moving  via  the  Central 
Railroad  of  New  Jersey,  thence  via  the  Lehigh  and 
Hudson  River  or  the  Lehigh  and  New  England  to  the 
New  Haven  at  May  brook.  The  Central  of  New  Jersey 
moves  freight  from  the  territory  west  of  Easton  via 
the  Lehigh  and  Hudson  to  Maybrook,  and  freight  from 
the  territory  east  of  Easton  is  interchanged  by  float 
in  New  York  harbor  to  the  New  Haven  at  Harlem 
River.  The  tonnage  received  from  these  roads  is 
mainly  anthracite  coal.  (Map  20.)  Their  inclusion 
with  the  Baltimore  &  Ohio  does  not  change  the  situa¬ 
tion,  for  the  interchange  of  the  New  Haven  with  the 
Pennsylvania  is  much  greater  than  the  combined  inter¬ 
change  with  the  Baltimore  &  Ohio,  Reading,  and  Cen¬ 
tral  Railroad  of  New  Jersey. 

It  also  seems  to  us  unquestionably  true  that  the  Bal¬ 
timore  &  Ohio  system  is  not  in  a  position  (whether 
combined  with  the  Reading  or  not)  to  carry  the  finan¬ 
cial  load  involved  in  the  acquisition  of  the  New  Haven. 

Position  of  Baltimore  &  Ohio  as  to  Consolidation 

with  New  Haven 

The  position  of  the  Baltimore  &  Ohio  railroad  in  re¬ 
gard  to  the  suggestion  to  include  the  New  Haven  rail¬ 
road  in  the  proposed  Baltimore  &  Ohio  system,  as  ex¬ 
pressed  before  the  Interstate  Commerce  Commission 


156 


at  its  hearing  in  Washington  on  May  17,  was  as  follows 
(Official  Statement  of  Daniel  Willard,  President  Balti¬ 
more  &  Ohio  railroad,  page  16)  : 

“We  are  of  the  opinion  that  the  New  York,  New 
Haven  and  Hartford  railroad  should  not  he  included 
in  the  Baltimore  and  Ohio-Reacling  system,  but  that 
the  properties  of  that  company  in  conjunction  with  all 
other  New  England  railroad  properties  East  of  the 
Hudson  River  should  be  consolidated  into  what  might 
he  termed  a  New  England  Regional  Group  to  be  held 
and  operated  as  a  distinct  unit  interchanging  traffic 
freely  and  without  prejudice  with  the  several  Trunk 
Line  systems  and  with  the  Canadian  railroads. 

“A  statement  is  attached,  marked  Exhibit  20,  show¬ 
ing  the  approximate  tonnage  interchanged  between  the 
several  New  England  Lines  and  their  various  connec¬ 
tions  to  the  North  and  East,  and  particular  attention 
is  called  to  the  fact  that  each  of  the  several  Trunk 
Lines  has  an  extensive  interchange.  While  the  Balti¬ 
more  and  Ohio  does  not  have  a  direct  interchange,  it 
participates  substantially  in  the  traffic  through  indirect 
connections  notably  via  the  Central  Railroad,  Reading, 
etc.” 


Consolidation  with  Pennsylvania  Natural 

and  Logical 

A  consolidation  of  the  New  Haven  with  the  Pennsyl¬ 
vania  seems  to  us  the  natural  and  logical  trunk  line 
consolidation  for  the  New  Haven  railroad  if  there  is 
to  he  a  trunk  line  consolidation.  We  do  not  under¬ 
stand  that  the  Pennsylvania  railroad  is  anxious  for 


157 


this  consolidation,  certainly  not  under  present  con¬ 
ditions,  as  it  is  not  eager  to  assume  the  heavy  financial 
burden  of  the  New  Haven.  The  President  of  the 
P ennsylvania  railroad  in  his  formal  printed  statement 
presented  before  Commissioner  Hall  at  the  Washing¬ 
ton  hearing  May  16,  speaking  of  the  New  Haven  rail¬ 
road,  said  (pp.  19-21)  : 

“Our  long  established  mutual  relations  have  built  up 
a  large  exchange  traffic,  and  as  a  consequence  well  es¬ 
tablished  commercial  relations  on  a  large  scale  have 
resulted  between  both  territories,  so  that  any  propo¬ 
sition  to  assign  the  New  Haven  and  its  traffic  to  any 
other  System  would  be  a  public  calamity,  as  well'  as 
hurtful  to  the  Pennsylvania  System.  It  is  true,  as 
Prof.  Ripley  points  out,  that  the  New  Haven’s  finan¬ 
cial  condition  is  not  strong,  and  under  existing  limited 
net  earnings  the  Pennsylvania  could  not  carry  its  own 
burdens  and  financially  carry  the  New  Haven  as  well. 
However,  under  the  proposed  Consolidation  Plan, 
which  requires  valuation  and  assumably  re-capitaliza¬ 
tion  of  the  Consolidated  Systems,  the  financial  ques¬ 
tions  must  be  faced,  and  if  adjusted  in  other  cases, 
similar  action  will  be  taken  for  New  Haven,  and  in  that 
event  I  am  sure  it  will  be  found  that  all  relationships, 
public  and  corporate,  will  unite  the  New  Haven  with 
the  Pennsylvania  System  as  the  best  method  of  giving 
the  broadest  transportation  service.  Even  if  that  re¬ 
sult  should  be  brought  about,  the  requirements  of  the 
territory  demand  a  separate  operating  organization 
dealing  with  New  England  problems  right  at  home. 
Further,  I  cannot  see  how  the  New  Haven  could  be 
assigned  to  another  system  without  assigning  with  it 


158 


the  guaranties,  traffic  relations  and  the  important  fa¬ 
cilities  which  the  Pennsylvania  provides.  ”... 

“We  realize  that  the  officers  of  the  New  Haven  Sys¬ 
tem  have  been  making  a  brave  struggle  to  meet  con¬ 
ditions  in  their  territory,  notwithstanding  they  must 
be  short  of  both  facilities  and  equipment,  because  of 
their  weak  financial  condition ;  and  are,  no  doubt,  hurt 
by  the  improved  highways  and  the  use  of  motor  trucks, 
which  must  result  in  making  many  of  the  branch  lines 
unprofitable.  To  the  extent  of  our  resources  we  have 
always  made  the  New  Haven  very  favorable  allow¬ 
ances  out  of  the  through  rates,  and  we  assist  in  sup¬ 
porting  the  New  York  Connecting  Railroad  which  is 
used  chiefly  for  traffic  to  and  from  the  New  Haven 
Railroad.  Until  the  financial  difficulties  of  this  situ¬ 
ation  are  cleared  up,  and  without  any  knowledge  of 
what  the  New  Haven  officers  may  recommend  to  the 
Commission,  I  feel  that  the  New  Haven  Road  should 
remain  separate  under  an  independent  management, 
exchanging  traffic  freely  with  the  various  connecting 
trunk  lines.” 

Consolidation  with  the  Pennsylvania  railroad  does 
not  seem,  therefore,  to  offer  an  immediate  harbor  of 
refuge  for  the  savings  banks  and  insurance  companies 
and  small  investors  of  New  England  who  are  such 
large  holders  of  the  New  Haven  bonds,  nor  for  the  dis¬ 
tressed  stockholders.  Under  the  terms  of  the  Trans¬ 
portation  Act  of  1920,  no  consolidation  can  be  made 
compulsory.  The  Pennsylvania  railroad  must  first  be 
persuaded  to  desire  to  assume  the  heavy  financial  bur¬ 
dens  involved  in  the  acquirement  of  the  New  Haven 
railroad,  and  this  seems  a  long  way  off.  (Map  21.) 


159 


The  Proposal  to  Ailocate  the  New  Haven  to  a 
Possible  Delaware,,  Lackawanna  &  Western 
—  Nickel  Plate  Consolidation 

Since  the  suggestion  in  Professor  Ripley’s  report 
that  the  Nickel  Plate,  the  Delaware,  Lackawanna  & 
Western,  and  the  New  Haven  might  be  consolidated, 
the  controlling  interests  of  the  Nickel  Plate  railroad 
have  made  application  to  the  Interstate  Commerce 
Commission  to  consolidate  with  the  Lake  Erie  &  West¬ 
ern  and  the  Toledo,  St.  Louis  &  Western  (The  Clover 
Leaf)  and  the  same  interests  have  also  recently  pur¬ 
chased  control  of  the  Chesapeake  &  Ohio  which  has  a 
first  class  deep-water  harbor  at  Hampton  Roads.  As 
the  suggestion  of  combining  the  New  Haven  with  the 
Nickel  Plate  system  seems  to  have  received  no  sup¬ 
port  from  any  quarter,  it  is  perhaps  not  necessary  for 
us  to  discuss  it  further. 

Trunk  Line  Consolidations  for  Northern 
New  England 

Turning  now  to  the  consolidations  proposed  for  the 
northern  New  England  lines  and  taking  up  first  Pro¬ 
fessor  Ripley’s  faintly  suggested  consolidation  of  the 
Boston  &  Maine  railroad  with  the  Erie,  which  appar¬ 
ently  he  discusses  merely  to  show  that  it  has  not  been 
overlooked,  it  seems  almost  enough  to  say  that  the  fi¬ 
nancial  situation  of  each  of  these  roads  is  such  that  to¬ 
gether  they  will  constitute  but  a  tottering  system  which 
probably  would  soon  fall  because  of  financial  weakness. 

The  pith  and  marrow  of  the  Transportation  Act  of 


160 


1920  is  to  set  up  a  limited  number  of  systems  combin¬ 
ing  financially  weak  roads  with  financially  strong  roads 
so  that  when  the  consolidations  have  been  accomplished 
we  shall  have  systems  which  can  bear  with  substantial 
equality  the  enforcement  of  the  “  uniform  rates  ”  con¬ 
templated  by  the  Transportation  Act  without  wrecking 
a  large  part  of  our  railroad  mileage  and  perhaps  at 
the  same  time  unduly  enriching,  or  at  least  unneces¬ 
sarily  enhancing  the  cost  of  transportation  on,  the  rich 
and  strong  roads. 

It  is  intimated  in  Professor  Ripley’s  report  that 
perhaps  the  Delaware  &  Hudson  might  be  combined 
with  the  Boston  &  Maine  and  the  Erie  Railroad;  but 
the  Delaware  &  Hudson  is  a  small  system,  and  while 
with  the  assistance  of  its  controlled  coal  mines  it  is 
reasonably  profitable,  if  it  tried  to  uphold  financially 
these  two  other  systems  it  would  be  a  case  of  an  ele¬ 
phant  sitting  on  a  pancake.  The  President  of  the 
Delaware  &  Hudson  made  this  perfectly  clear  in  his 
statement  before  Commissioner  Hall.  There  is  no 
gainsaying  it. 

The  Proposal  to  Allocate  Northern  New  England 
Railroads  to  the  New  York  Central 

Undoubtedly  the  only  trunk  line  consolidation 
worthy  of  serious  consideration  in  the  case  of  the 
Northern  New  England  lines  is  the  consolidation  pro¬ 
posed  with  the  New  York  Central  system.  This  is  the 
Interstate  Commerce  Commission’s  suggested  tentative 
alternative,  in  its  11  System  No.  1  —  New  York  Cen¬ 
tral  ”  for  a  New  England  system,  and  presented  to  de- 


161 


velop  “  the  situation  upon  hearing.”  If  the  New  York 
Central  chooses  to  support  the  financial  load  involved, 
there  seems  to  be  no  reason  to  doubt  its  ability.  If  the 
New  York  Central  is  to  consolidate  with  the  Boston 
&  Maine,  and  if  the  purpose  of  Congress  is  to  be  car¬ 
ried  out  in  its  declared  desire  for  consolidation  of  the 
railroads  of  the  United  States  into  a  “  limited  ”  num¬ 
ber  of  great  systems,  there  exists  no  reason  to  exclude 
the  Maine  Central  and  the  Bangor  &  Aroostook  in  this 
consolidation.  The  Commission,  indeed,  includes  them 
in  its  tentative  System  No.  1  just  mentioned  above. 
These  two  roads  if  left  outside  the  pale,  whether  judged 
by  mileage  or  gross  receipts,  would  constitute  hardly 
more  than  toy  railroads  compared  with  the  great  sys¬ 
tems  contemplated  by  the  Transportation  Act. 

Under  the  conditions  as  they  exist  today  the  New 
York  Central  by  means  of  its  lease  of  the  Boston  & 
Albany  Railroad  reaches  directly  across  New  England 
from  east  to  west.  (Map  22.)  We  can  all  remember 
that  some  years  ago  when  the  then  directing  officers  of 
the  New  York  Central  system  failed  to  exhibit  the 
signal  ability  of  the  officers  of  today,  the  service  rend¬ 
ered  by  the  Boston  &  Albany  Railroad  was  lamentable 
and  generally  considered  the  worst  in  New  England. 
Today  the  operation  of  the  Boston  &  Albany  is  entitled 
to  the  highest  praise.  Human  affairs  are  mutable  and 
New  England  may  well  pause  before  it  favors  placing 
all  this  additional  New  England  mileage  in  a  single 
control  and  that,  too,  outside  of  New  England.  New 
England  should  not  shirk  its  responsibility  for  the 
present  lamentable  condition  of  the  New  Haven  Rail¬ 
road,  but  the  general  feeling  and  understanding  in  New 


162 


England,  that  while  the  series  of  unfortunate  chapters 
in  this  road’s  history  were  being  written,  the  actual 
though  not  technical  control  of  this  road  lay  outside 
New  England,  has  a  foundation  in  fact  and  should  not 
be  too  soon  forgotten. 

Views  of  Trunk  Line  Presidents  on  Disposition  of 
Northern  New  England  Roads 

The  natural  wish  of  the  Commission  fully  to  develop 
the  situation  affecting  New  England  transportation, 
which  it  had  in  view  in  tentatively  including  the  Bos¬ 
ton  &  Maine,  the  Maine  Central,  and  the  Bangor  & 
Aroostook  in  the  New  York  Central,  was  realized  at 
the  hearings  in  Washington  in  May.  Representatives 
of  the  Baltimore  &  Ohio,  the  Pennsylvania,  the  Dela¬ 
ware  &  Hudson,  and  the  New  York  Central  itself  all 
discussed  it.  None  favored  it,  although  President 
Smith  of  the  New  York  Central  withheld  final  judg¬ 
ment  pending  the  report  of  this  Committee. 

L.  E.  Loree,  President  of  the  Delaware  &  Hudson 
Company,  in  his  statement  before  the  Interstate  Com¬ 
merce  Commission,  at  the  hearing  on  May  19th,  said 
(pp.  13-15  his  printed  statement)  : 

‘  ‘  Boston  &  Maine  Railroad.  The  plan  would  seem 
to  have  the  effect  of  greatly  augmenting  the  power  of 
the  New  York  Central.  This  is  shown  by  the  allo¬ 
cation  of  the  Boston  &  Maine  Railroad  to  the  New  York 
Central,  accompanied  by  a  provision  for  the  perpetu¬ 
ation  of  its  control  of x the  Boston  &  Albany;  the 
omission  of  any  consideration  of  the  West  Shore  sepa¬ 
rate  from  that  system ;  the  refusal  to  include  the  Michi- 


163 


gan  Central  in  the  proposed  Pere  Marquette  system, 
although  Professor  Ripley  considered  that  ‘  the  desir¬ 
ability  of  withdrawing  it  from  the  New  York  Central 
...  is  self-evident,  ’  and  the  weakening  of  its  greatest 
rival  by  making  the  Norfolk  and  Western  Railway  the 
center  of  an  independent  system.  ’  ’ 

“  The  Delaware  &  Hudson  would  be  particularly  and 
most  unfavorably  affected  by  the  proposed  transfor¬ 
mation  of  the  Boston  &  Maine  from  an  independent 
operating  concern  to  an  integral  portion  of  a  system 
which  would  be  capable  of  diverting  to  its  own  rails  a 
great  deal  of  the  traffic  which  now  passes  from  and  into 
New  England  through  the  Mechanicville  gateway.” 

“  The  railroad  of  the  Delaware  &  Hudson  Company 
had  its  origin  in  the  necessity  to  provide  facilities  for 
the  distribution  of  the  product  of  anthracite  lands  in 
Pennsylvania.  The  original  project  was  that  of  the 
owners  of  these  lands  and  very  many  years  ago  their 
interest  and  the  interest  of  many  New  England  com¬ 
munities  united  in  establishing  New  England  as  their 
principal  market.  To  that  end,  the  railway  route  to 
Mechanicville  was  created  and  it  is  very  largely  for  the 
purpose  of  transporting  the  anthracite  products  of  the 
same  and  adjacent  lands  that  it  still  exists.  Its  con¬ 
nection  at  Mechanicville  is  with  the  Boston  &  Maine 
and  it  is  understood  that,  over  a  period  of  years,  about 
sixty  per  cent  of  the  traffic  interchanged  with  the  West 
by  that  railroad  has  been  by  way  of  the  Delaware  & 
Hudson.  Moreover,  the  Delaware  &  Hudson  is  a 
‘  bridge  ’  carrier,  forming,  by  means  of  connections, 
through  Binghampton,  with  the  Erie,  Delaware,  Lack¬ 
awanna  and  Western,  and  Lehigh  Valley,  part  of  three 


164 


trunk  line  routes  and,  in  addition  to  coal,  it  is  able  to 
deliver  to  the  Boston  &  Maine  important  general  mer¬ 
chandise  traffic.  It  is,  also,  an  intermediate  carrier 
of  traffic  interchanged  with  New  England  and  passing 
to  or  from  the  lines  of  the  Pennsylvania;  New  York, 
Ontario  and  Western;  Central  Railroad  of  New  Jer¬ 
sey;  Philadelphia  &  Reading,  and  Baltimore  and  Ohio 
railroads.  A  very  large  amount  of  bituminous  coal 
moves  over  its  rails  for  the  use  of  the  manufacturers 
and  railroads  of  northern  New  England.  It  receives 
from  the  Boston  and  Maine  westbound  traffic  for 
transportation  over  the  same  routes.  While  the  allo¬ 
cation  of  the  Boston  &  Maine  to  a  competitive  system 
might  not  prevent  its  acceptance  of  anthracite  passing 
over  the  Delaware  &  Hudson  rails,  it  would  probably  re¬ 
sult  in  its  delivering  to  the  New  York  Central  all  west¬ 
bound  traffic  which  it  could  control  and  closing  its  rails 
to  much  eastbound  traffic  not  originating  on,  but  which 
otherwise  would  pass  over,  the  Delaware  and  Hudson. 
The  latter  has  never  been  able  to  negotiate  joint  rates 
for  bituminous  coal  for  delivery  via  the  Boston  and 
Albany  and  the  Interstate  Commerce  Act  requires  no 
railway  system  to  open  its  route  for  joint  services  un¬ 
less  it  receives  a  haul  equal  to  substantially  its  entire 
length.’  ’ 

“  Professor  Ripley  recommended  the  union  of  the 
essential  portion  of  the  Boston  &  Maine  with  the  Dela¬ 
ware  and  Hudson,  unless  a  separate  New  England 
system  would  be  established.  He  characterized  the 
suggestion  that  the  Boston  &  Maine  should  be  united 
with  the  New  York  Central  as  1  the  baldest  proposal’ 
and  said  that  it  would  cut  down 1  competition  at  most  of 


165 


the  important  New  England  centers.’  .  .  .  No  conceiv¬ 
able  adjustment  which  could  be  made  would  make  up  to 
the  property  which  I  represent  the  loss  which  it  would 
sustain  in  the  exclusion  from  and  diversion  of  impor¬ 
tant  traffic  which  it  now  enjoys,  should  this  portion  of 
the  tentative  plan  be  consummated.” 

Remarks  of  Mr.  Rea,  President  of  the  Pennsylvania 
Railroad  in  regard  to  relationship  of  the  Pennsylvania 
to  the  Boston  &  Maine  should  be  noted.  (Mr.  Rea’s 
printed  statement,  page  18)  : 

“  It  is  surprising  to  note  the  volume  flowing  to  and 
from  the  Boston  &  Maine  Railroad,  which  is  the 
primary  System  for  Central  and  Northern  New  Eng¬ 
land,  and  aside  from  its  interchange  with  the  New  York 
Central,  it  handled  practically  all  the  freight  between 
that  section  and  points  west  of  the  Hudson,  via  the 
Delaware  &  Hudson,  the  Erie,  the  Lehigh  Valley  and 
the  Lackawanna  Systems,  and  through  these  roads 
traffic  from  the  Pennsylvania.  The  Pennsylvania  is 
deeply  interested  in  keeping  the  Boston  and  Maine  as 
a  gateway  and  open  traffic  exchange,  notably  through 
the  Delaware  &  Hudson  System  and  the  joint  Wilkes- 
Barre  Gateway  in  Pennsylvania.” 

On  the  Boston  &  Maine  system  the  largest  inter¬ 
change  business  today  is  not  with  the  New  York  Cen¬ 
tral  system  but  with  the  Delaware  &  Hudson. 


166 


The  average  daily  interchange  of  cars  moving  both 
east  and  west  between  the  Boston  &  Maine  Railroad 
and  its  connections  (year  ending  June  30,  1922)  was: 


Loaded 

Cars 

Total 

Cars 

Delaware  &  Hudson . 

326,193 

New  York  Central . 

Grand  Trunk,  direct  . 

.  11,242 

...  126,107 

21,464 

191,497 

Grand  Trunk,  via  Central 

Vermont  28,472 

39,714 

40,290 

61,754 

Canadian  Pacific,  direct  . 

.  39,121 

58,973 

Canadian  Pacific,  via  Quebec  Central  3,409 

6,270 

42,530 

65,243 

Total  . 

418,836 

644,687 

Mr.  Loree,  however,  submitted  to  the  Interstate 
Commerce  Commission  a  financial  exhibit  entitled 
“  Delaware  &  Hudson  and  New  England  District,  Con¬ 
densed  Statistical  Study  of  Various  Lines,  Year  1921.” 
which  showed  that  in  that  year  the  consolidation  of  the 
Northern  New  England  roads  with  the  Delaware  & 
Hudson  would  have  shown  a  deficit  after  fixed  charges 
of  $5,190,996,  and  if  the  Delaware  &  Hudson’s  income 
from  coal  operations  was  excluded  a  deficit  of  $7,707,17 0. 
It  is  true  that  this  statement  included  the  Central  Ver¬ 
mont  as  well  as  the  Boston  &  Maine,  Maine  Central 
and  Bangor  &  Aroostook.  If  the  Central  Vermont  be 
omitted  the  deficit  would  remain  substantially  $3,583,139 
with  the  income  from  coal  properties,  and  the  deficit 
would  have  been  $6,099,313  if  the  income  from  the 
coal  properties  be  excluded. 

One  thing  to  bear  in  mind  in  studying  traffic  con¬ 
ditions  with  reference  to  New  England’s  future  wel¬ 
fare  is  the  provision  of  the  Interstate  Commerce  Act 
that  no  railroad  is  obliged  to  “short-haul”  itself. 
This  means  that  if  a  shipper  gives  freight  to  the  Bos¬ 
ton  &  Albany  that  railroad  has  the  right,  and  in  prac- 


167 


tice  exercises  the  right,  to  haul  the  freight  all  the  way 
to  the  desired  destination,  if  its  system,  which  in  the 
case  of  this  road  includes  all  the  lines  of  the  New  York 
Central,  reaches  that  destination,  and  if  the  system  does 
not  reach  the  destination  then  so  far  as  it  can  be  hauled 
in  that  direction  on  the  New  York  Central.  One  bear¬ 
ing  of  this  is,  that  a  shipper  delivering  freight  for  the 
West  to  the  Boston  &  Maine,  for  example,  has  today 
a  great  choice  of  routes  west  of  the  Hudson  River  over 
which  he  can  send  his  merchandise,  owing  to  the  numer¬ 
ous  and  competitive  trunk  line  connections  available 
through  Mechanicville  gateway  or  he  can  ship  via  the 
northern  gateways,  White  River  Junction  and  New¬ 
port,  Vt.,  over  the  Canadian  lines.  This  is  not  only  a 
good  thing  for  the  individual  shipper  in  affording  him 
a  choice  of  routing  which  it  is  often  in  his  interest  to 
exercise,  because  of  varying  traffic  conditions,  or  be¬ 
cause  of  convenience  of  access  to  the  car  on  the  part  of 
his  customer  at  the  other  end,  or  because  of  any  one  of 
a  number  of  other  reasons,  but  it  operates  also  to  the 
advantage  of  New  England  as  a  whole.  It  has  been 
largely  because  our  shippers  have  been  able  to  ship,  by 
what  route  they  chose,  a  large  part  of  the  traffic  origi¬ 
nating  in  New  England,  that  New  England  has  ob¬ 
tained  many  advantages  which  have  helped  to  build  up 
our  industries. 

If  the  Boston  &  Maine  became  a  part  of  the  New 
York  Central  system  this  freedom  to  use  competitive 
routes  would  be  denied  New  England  shippers  in  all 
cases  where  direct  routing  over  the  New  York  Central 
is  possible. 

It  is  a  bit  enlightening  on  this  point  to  quote  from 


1 


168 

the  statement  of  some  of  the  trunk  line  presidents 
made  at  the  Washington  hearing  of  May  16. 

Views  of  President  Rea  and  President  Willard  on 
Importance  of  Maintaining  Free  Routing  in  New 
England. 

Mr.  Rea,  President  of  the  Pennsylvania  Railroad,  in 
his  testimony  before  the  Interstate  Commerce  Commis¬ 
sion  in  reference  to  the  subject  of  maintaining  free 
routing  for  all  of  the  Trunk  Lines  in  New  England, 
said :  (Record,  pp.  7318-7319) 

“  Q.  With  reference  to  New  England,  I  take  it  that 
it  is  your  view  that  it  is  very  essential  to  that  district 
that  a  free  and  open  routing  by  all  of  the  trunk  lines 
be  preserved  ?  ’  ’ 

“  A.  Yes,  sir;  and  by  all  gateways.” 

“  Q.  Do  you  think  that  would  be  as  likely  to  be 
preserved  if  there  were  a  partition  of  the  New  Eng¬ 
land  lines  among  the  trunk  lines,  if  that  general  plan 
were  followed  of  partitioning  the  whole  territory?  ” 
“A.  That  is,  partitioning  the  New  England  lines 
among  three  or  four  trunk  lines?  ” 

“  Q.  Yes;  partitioning  the  New  England  lines 
among  three  or  four  trunk  lines.” 

“  A.  Well,  it  would  have  to  be  among  them  all,  and 
you  would  have  to  have  a  neutral  management,  but  I 
don’t  know  then  that  it  would  be  satisfactory.  It  is  a 
very  difficult  proposition,  I  am  bound  to  say.  Of 
course,  if  the  railroads  of  New  England  were  affluent 
they  could  do  a  great  many  more  things  than  they  have 
been  able  to  do.  Perhaps  the  traffic  conditions  would 
not  have  gotten  quite  so  bad  as  they  do  when  congestion 


occurs. 


169 


Mr.  Daniel  Willard,  President  of  tlie  Baltimore  & 
Ohio  Railroad,  expressed  his  views  on  the  trunk  line 
treatment  of  the  New  England  carriers  before  the  In¬ 
terstate  Commerce  Commission,  May  17th,  in  part  as 
follows :  (Record,  pp.  7367-7370) 
u  Now,  from  the  service  standpoint  I  think  there  is 
this  thing  to  be  considered.  It  is  proposed  in  the  tenta¬ 
tive  plan  that  the  New  Haven  road  should  be  given  to 
the  Baltimore  &  Ohio  group.  Mr.  Rea  has  protested, 
very  properly,  against  that,  because  of  the  disturbance 
which  it  would  make  in  long-existing  conditions.” 

“  The  plan  also  proposes  to  give  the  Boston  &  Maine 
to  the  New  York  Central;  and  they  would  have  the 
Boston  &  Albany  and  the  Boston  &  Maine.  If  the 
Commission  should  yield  to  the  arguments  of  Mr.  Rea 
and  leave  the  New  Haven  road  connected  with  the 
Pennsylvania,  then  I  wonder  what  there  would  be  left 
in  New  England  to  interest  the  Baltimore  &  Ohio. 
We  maintain  commercial  agents  in  Boston  today  and 
in  other  New  England  points  in  an  effort  to  get  as 
much  business  as  may  be  influenced  to  go  over  our  line. 
If  those  lines  were  all  tied  up  to  trunk  lines  west  of  the 
Hudson  River,  it  seems  to  me  we  would  not  be  justified 
under  such  conditions  in  leaving  representatives  in 
New  England  at  all.  What  could  we  get  for  it?  ” 

“  I  am  told  that  the  New  England  people  have  felt 
that  they  would  be  better  served  with  trunk  lines  going 
in  and  coupling  up  with  the  New  England  roads.  I 
think  that  is  a  fallacy.  A  man  does  not  run  after  a 
street  car  after  he  catches  it ;  and  when  you  have  tied 
the  roads  together  you  have  definitely  determined  how 
much  of  that  business  is  going  to  move,  and  you  have 
taken  it  out  of  the  field  of  competition.” 


170 


“  It  seems  to  me  if  all  tlie  New  England  roads  were 
in  a  group,  if  rate  divisions  were  made  at  the  Hudson 
River  or  Canadian  boundary,  and  if  all  roads  were  in 
a  position  to  interchange  business  on  even  terms,  if  all 
roads  outside  could  interchange  on  a  parity  with  all 
roads  in  New  England,  then  I  am  sure  that  under  such 
conditions  we  would  want  representatives  in  New  Eng¬ 
land.  We  would  solicit  their  business,  and  by  the  kind 
of  service  which  we  would  give  them,  we  would  hope  to 
increase  our  business  in  that  section.  It  seems  to  me 
that  situation  would  do  more  to  improve  the  service 
into  and  out  of  New  England  than  any  possible  com¬ 
bination  of  existing  railroads.  And  it  is  because  of  all 
those  things,  Mr.  Chairman,  it  seems  to  me  that  it 
would  be  better  to  deal  with  New  England  as  a  group 
rather  than  as  a  part  of  the  Baltimore  &  Ohio  or  any 
other  road.” 

u  Q.  (By  Prof.  Ripley)  Do  you  think,  Mr.  Wil¬ 
lard,  that  that  would  somewhat  automatically  take  care 
of  the  question  of  division  of  through  rates  to  New 
England  points?  ” 

“  A.  Well,  I  suppose  what  you  have  in  mind  is  this, 
that  the  different  roads  might  bid  against  each  other. 
There  would  always  be  that  opportunity,  of  course,  be¬ 
tween  the  Canadian  and  the  American  roads,  because 
the  Canadian  roads  would  not  be  under  the  jurisdic¬ 
tion.  And  New  England  would  still  have  as  much 
advantage  from  that  avenue  as  she  has  today.  But  as 
to  whether  the  roads  west  of  the  Hudson  would  be 
likely  to  reduce  rates  as  against  each  other,  they  would 
be  just  as  likely  to  do  it  then  as  they  are  now ;  and  even 
now  I  think  we  have  reached  the  basis  where  those 


171 


things  are  likely  not  to  happen  so  much  as  in  the  past. 
The  present  arrangements  make  more  for  stability.  ” 

“  Q.  Would  you  have  the  competition  between  the 
Canadian  and  American  roads  ?  ’  ’ 

“  A.  That  you  would  have,  and  just  as  much  as  you 
have  now  between  the  American.” 

‘  ‘  Q.  Do  you  regard  the  preservation  of  those  Cana¬ 
dian  routes  as  of  real  significance  to  New  England?  ” 
“  A.  I  think  New  England  probably  regards  them 
as  such,  and  they  would  not  be  interfered  with  at  all 
by  this.  Nothing  in  the  plan  I  have  suggested,  from 
my  point  of  view,  would  weaken  the  position  of  New 
England  to  demand  good  service  and  get  good  rates. 
On  the  contrary,  I  think  their  ability  to  route  their  bus¬ 
iness  to  this,  that  or  the  other  road  would  put  every 
road  on  notice,  and  everybody  would  be  running  after 
the  street-car.” 

(Record,  pp.  7373-7375.)  “  Q.  (By  Mr.  Shriver) 

Before  you  leave  that,  Mr.  Willard,  you  referred  to  the 
particular  interest  the  Pennsylvania  had  in  the  New 
England  interchange?  ” 

“  A.  Yes,  sir.” 

“  Q.  The  statement  you  have  filed  showing  the  dis¬ 
tribution  of  New  England  traffic  for  a  constructive 
year  showed  the  Pennsylvania  interchanges  18.54  per 
cent.  That  statement  also  shows  the  interchange  with 
the  Central  Railroad  of  New  Jersey  as  15.41  per  cent 
of  the  tonnage.  ’  ’ 

“  A.  Yes.” 

“  Q.  That  is  also  a  large  interest.” 

“  A,  I  am  glad  you  reminded  me  of  that  because  I 
shall  now  want  to  say  this,  that  if  the  Commission 


172 


should  decide  not  to  make  New  England  a  separate 
group  as  I  have  suggested,  then  in  that  event  I  should 
think  you  would  leave  the  New  Haven  road  as  a  part 
of  the  Baltimore  &  Ohio  and  Reading  group,  because 
if  that  is  the  way  it  is  going  to  be  settled,  then  I  should 
hope  the  Baltimore  &  Ohio  group  might  have  some  con¬ 
nection  in  New  England.  ” 

u  Q.  (By  Prof.  Ripley)  In  other  words,  Mr.  Wil¬ 
lard,  isn’t  it  an  almost  inevitable  result  of  affiliation  of 
part  of  New  England  with  any  trunk  line  that  that 
trunk  line  would  enjoy  a  predominant  share  of  the 
business  so  far  as  it  could?” 

“A.  So  far  as  it  could,  undoubtedly.” 

‘ 1  Q.  And  that  would  interfere  with  the  freedom  of 

routing - ” 

“A.  So  it  seems  to  me.” 

“  Q.  With  all  the  trunk  lines  that  they  now  en j oy  ?  ” 
“A.  It  is  for  that  reason,  as  I  say,  we  would  he 
quite  satisfied,  entirely  satisfied,  and  would  prefer  to 
stay  at  the  west  bank  of  the  Hudson  River.  But  still 
if  one  road  goes  over,  we  will  want  to  go  over  with  the 
rest,  and  I  should  want  the  New  Haven  left  with  the 
Baltimore  &  Ohio  under  this  proposition.” 

“  Q.  In  other  words,  any  grouping  of  New  England 
should  he  at  least  in  such  form  that  each  of  the  trunk 
lines  will  get  a  part?  ” 

“A.  Yes,  sir.” 

“Q.  As  long  as  none  of  them  have  anything,  you 
have  no  desire  to  go  in  ?  ” 

“  A.  I  have  no  desire  to  go  in  at  all  if  none  of  the 
rest  go  in,  but  if  even  one  goes  in,  I  want  to  go  in  also.” 
“  Q.  (By  Mr.  Brown)  Go  in  or  stay?  ” 


173 


“A.  Or  come  out.” 

“  Q.  (By  Commissioner  Hall)  Some  are  in  al¬ 
ready.  ’  ’ 

u  A.  I  think  that  is  not  an  insurmountable  situation 
to  deal  with.” 

(Record,  pp.  7420-7421.)  “  Q.  Coming  to  New 

England  for  a  moment,  do  you  feel  that  it  should  be 
part  of  the  sound  national  policy  to  develop  Up-River 
contacts  for  New  England,  rather  than  to  throw  the 
traffic  more  and  more  through  the  Port  of  New  York  ?  ” 

“A.  No,  I  think  New  England  —  it  seems  to  me 
that  they  ought  to  make  the  fullest  use  possible  of  their 
water  transportation  facilities,  which  they  always  have 
used.  They  have  been  built  up  on  that  basis,  bring¬ 
ing  their  coal  and  lumber  and  stuff  along  the  coast  and 
then  carrying  it  inland  either  by  water  or  by  rail.  It 
seems  to  me  that  is  an  economically  sound  arrangement 
and  ought  to  be  continued.” 

“  Q.  I  was  thinking  rather  of  that  interior  coal  line 
that  is  developed  on  your  property.  The  contact  of 
that  line  with  New  England  is  in  part  by  way  of  the 
Poughkeepsie  route,  isn’t  it?  ” 

“A.  Yes,  sir.” 

“  Q.  The  question  is  this:  Isn’t  the  development 
of  traffic  moved  by  such  an  up-river  route,  instead  of 
going  directly  through  New  York,  on  the  whole  desir¬ 
able  as  a  part  of  the  policy  looking  to  the  future?  ” 

“A.  Well,  that  would  not  go  through  New  York, 
would  it?  Coal  going  to  New  England  via  Pough¬ 
keepsie  ?  ’  ’ 

“Q.  No.  It  avoids  New  York.  That  is  just  the 
point.” 


174 


The  Fear  that  a  New  England  Group  would  have 

TOO  GREAT  POWER  IN  DEALING  WITH  TRUNK  LlNES 

The  comment  of  W.  H.  Williams,  Vice  President  of 
the  Delaware  &  Hudson  Railroad  and  Chairman  of  tlie 
Board  of  the  Wabash,  upon  the  strength  of  the  group¬ 
ing  of  New  England  lines  in  its  relations  with  the 
Trunk  Lines  should  perhaps  be  referred  to.  He  said 
before  the  Interstate  Commerce  Commission  May  18, 
(record  page  7767)  :  — 

“  In  the  event  of  the  consummation  of  the  proposed 
grouping  of  the  New  England  lines,  think  of  the  power 
that  would  be  given  them  on  such  questions  as  divisions, 
service,  per  diem  and  the  furnishing  of  cars.  They 
could  take  all  of  their  traffic  and  turn  it  over  to  one 
system  west  of  the  Hudson  until  they  forced  another 
line  to  give  them  something  to  which  they  might  not 
be  equitably  entitled.  For  example,  they  could  turn 
over  all  of  their  traffic  to  the  Pennsylvania  and  keep 
it  there  until  the  New  York  Central  should  outbid  its 
competitor.  In  dealing  with  this  situation  it  is  sig¬ 
nificant  that  the  New  York  Central  has  been  granted 
an  important  advantage  over  competing  properties 
through  the  allocation  to  it  of  the  Boston  &  Albany 
lines,  permitting  exclusion  of  competitive  traffic  over 
those  lines.  This  preferential  position  has  been  fur¬ 
ther  strengthened  through  the  tentative  assignment  to 
the  New  York  Central  of  the  additional  lines  of  the 
Boston  &  Maine,  Maine  Central  and  Bangor  &  Aroos¬ 
took.  This  arrangement  tends  to  enlarge  and  support 
a  system,  declared  to  be  already  of  sufficient  magnitude 


175 


and  strength,  at  the  expense  of  less  powerful  and  more 

natural  connections.” 

and  (record  on  page  7776)  :  — 

“I  think  there  is  another  thing  that  would  be  of  con¬ 
siderable  interest  to  develop.  In  the  New  England 
Divisions  Case  there  was  an  analysis  made  of  the  traffic 
interchanged  between  the  New  England  lines  and  the 
other  territories,  and  this  analysis  (Brigham  Exhibit 


No.  14)  showed: 

Interchange  with  Trunk  Line  Territory  61.0% 

Interchange  with  Central  Freight  Association 

Territory  27.0 

Interchange  with  Territory  west  of  the  Mississippi 
Biver  3.7 

Interchange  with  Canadian  roads  3.0 

Interchange  with  Southern  roads  2.8 

Interchange  with  Transcontinental  traffic 

(moving  on  transcontinental  rates)  2.5 


This  would  emphasize,  in  a  way,  that  if  all  the  New 
England  lines  were  placed  in  one  group  and  this  traffic 
diverted  to  one  of  the  trunk  lines,  it  would  have  a  ter¬ 
rific  effect.  It  would  not  make  much  difference  to  the 
transcontinental  lines  but  would  in  the  intermediate 
territory.  ’  ’ 

If,  because  of  a  New  England  consolidation,  we 
should  acquire  the  power  feared  by  Mr.  Williams,  we 
should  try  to  use  it  humbly  and  under  the  direction  of 
the  Interstate  Commerce  Commission  and  so  as  to  earn 
the  good  will  of  our  neighbors.  It  would  not,  we  sup¬ 
pose,  be  reasonable  to  expect  some  of  these  trunk  line 
presidents  to  consider  in  their  consolidation  plans  what 
might  be  for  the  interest  of  these  seven  and  a  half  mil- 


176 


lion  people  living  in  New  England,  but  their  views  do 
seem  to  take  on  a  bit  the  color  of  Joseph’s  brothers 
casting  lots  for  his  clothes. 

Mr.  L.  P.  Loree,  President  of  the  Delaware  &  Hud¬ 
son  Company,  said  in  the  same  connection  (printed 
statement,  page  18)  : 

“New  England.  Contrary  to  a  general  public  im¬ 
pression,  there  is  no  proposal,  in  the  1  tentative  plan  ’ 
or  by  Professor  Ripley,  to  create  a  single  system  em¬ 
bracing  all  New  England  lines.  Perpetuation  of  the 
control  of  the  New  York  Central  over  the  Boston  and 
Albany,  and  that  of  the  Grand  Trunk  (of  Canada)  over 
the  Central  Vermont,  as  well  as  the  continued  owner¬ 
ship  by  the  Grand  Trunk  and  Canadian  Pacific  of 
their  railway  properties  in  northeastern  New  Eng¬ 
land,  seems  to  have  been  accepted  without  question. 
The  consolidation,  into  a  single  system,  of  the  remain¬ 
ing  New  England  railways  is,  however,  one  of  the 
proposals  and,  as  to  this,  it  is  necessary  to  observe 
that  the  power  of  such  a  combination  to  divert  an  im¬ 
portant  volume  of  traffic,  at  its  pleasure,  from  one 
connection  to  another,  would  confer  an  opportunity 
to  extort  unfair  and  excessive  divisions  which  would 
certainly  be  utilized  and  which  ought  not  to  be  per¬ 
mitted.  The  control  of  traffic  originating  on  one  such 
railroad  has,  in  the  past,  been  utilized  to  produce  pre¬ 
cisely  that  result,  that  company  receiving  as  much  as 
one-fourth  of  the  total  earnings  for  a  haul  of  150  miles 
out  of  a  1,000-mile  haul,  or  twenty-five  per  cent  of 
the  compensation  for  fifteen  per  cent  of  the  service. 
Sixty-one  per  cent  of  the  traffic  of  New  England  rail- 


177 

ways  is  interchange  traffic,  to  or  from  Trunk  Line  con¬ 
nections. 

“I  have,  therefore,  two  suggestions  to  make  as  to 
New  England,  as  follows:  — 

“  1-  That  New  England  railways  located  north  of 
the  Boston  &  Albany  (the  Boston  &  Maine,  Maine  Cen¬ 
tral,  Bangor  &  Aroostook  and  Central  Vermont)  be 
united  with  those  of  The  Delaware  &  Hudson  Company, 
or, 

“  2.  That  the  New  England  railways  located  north 
of  the  Boston  &  Albany  be  united  with  those  of  the 
Boston  &  Albany  and  that  the  Delaware  and  Hudson 
and  the  New  York  Central  Bailroad  Company  become 
owners  of  equal  interests  in  the  consolidated  property.” 

Mr.  William  S.  Jenney,  Counsel  for  the  Delaware, 
Lackawanna  &  Western  Railroad  expressed  himself 
in  Washington  as  not  agreeing  with  the  position  taken 
by  Mr.  Williams  and  Mr.  Loree.  We  quote  from  his 
testimony.  (Record  page  7871.) 

“  Q.  In  that  connection  I  would  like  to  read  a  para¬ 
graph  from  Mr.  Williams  ’  statement  yesterday  on  be¬ 
half  of  the  Wabash,  and  ask  you  if  in  your  judgment 
it  represents  the  situation.” 

‘  ‘  In  the  event  of  the  consummation  of  the  proposed 
grouping  of  the  New  England  lines,  think  of  the  power 
that  would  be  given  them  on  such  questions  as  divisions, 
service,  per  diem,  and  the  furnishing  of  cars.  They 
could  take  all  of  their  traffic  and  turn  it  over  to  one 
system  west  of  the  Hudson  until  they  forced  another 
line  to  give  them  something  to  which  they  might  not  be 
equitably  entitled.  For  example,  they  could  turn  over 
all  of  their  traffic  to  the  Pennsylvania  and  keep  it 


178 

there  until  the  New  York  Central  should  outbid  its 
competitors.  ” 

“  And  in  another  place:” 

‘  The  figures  of  interchange  would  emphasize,  in  a 
way,  that  if  all  the  New  England  lines  were  placed  in 
one  group  and  this  traffic  diverted  to  one  of  the  trunk 
lines,  it  would  have  a  terrific  effect. ’ 

“A.  I  do  not  agree  with  him  at  all.  I  don’t  think 
there  is  any  thing  to  that  at  all.” 

“  Q.  Do  you  think  that  power  might  be  utilized  to 
secure  a  fairer  division  of  the  through  joint  rates?” 

“  I  will  not  use  the  word  1  fairer’,  but  to  bring  about 
an  equitable  adjustment  in  the  division  of  the  through 
rates.  ’  ’ 

“A.  I  doubt  if  they  could  exert  enough  power  even 
for  that.  What  I  mean  to  say  is  that  I  think  they 
would  have  to  go  to  the  Commission  if  they  were  to  get 
any  larger  division  of  rates  than  now.  I  don’t  think 
they  would  be  able  to  force  that  tonnage  over  one  line. 
It  has  to  go  over  its  natural  routes.  The  Pennsylvania 
have  to  take  it  and  the  New  York  Central  have  to  take 
it,  and  what  is  left  will  go  to  the  other  lines.  The  New 
England  lines,  even  if  operating  as  one  property,  could 
not  force  the  routing  of  traffic  in  any  one  direction 
so  as  to  get  any  undue  advantage  or  anything  of  that 
sort,  in  my  judgment.” 

“  Q.  But  the  advantage  of  that  consolidated  group 
would  be  to  perpetuate  opportunity  as  among  all  the 
trunk  lines,  whether  they  were  of  equal  size  and 
strength  or  not?” 

“A.  I  think  it  would  be  very  helpful  from  a  trunk 
line  standpoint.  In  other  words,  I  think  that  the  trunk 


179 


line  that  gives  the  best  service,  etc.  would  increase  its 
New  England  business.” 

“  Q-  You  are  not  assuming,  are  you,  that  competing 
strength  of  the  big  as  against  the  lesser  companies  is 
a  matter  of  size?” 

“  A.  Oh,  no.  I  don’t  think  it  is  a  matter  of  size.  In 
other  words,  the  small  company  that  had  a  profitable 
business  to  a  very  much  lesser  extent  than  a  large  com¬ 
pany,  who  had  a  very  much  smaller  interest  charge, 
might  be  able  to  do  as  well  upon  its  small  business  as 
the  big  company  upon  its  bigger  business.  I  do  not 
think  it  is  necessary  to  have  the  companies  of  the  same 
size,  but  you  have  to  create,  it  seems  to  me,  if  we  are 
going  to  have  two  small  trunk  lines  in  competition  with 
three  big  lines,  a  condition  where  you  have  the  small 
lines  in  a  position  where  they  can  get  business  from  all 
the  different  parts  of  the  country.  You  cannot  practi¬ 
cally  shut  them  off  from  Pittsburgh  and  Chicago  and 
shut  them  off  from  New  England  and  Philadelphia 
and  expect  them  to  do  business.” 

Importance  of  Canadian  Gateways 

In  considering  this  consolidation  of  the  Boston  & 
Maine  with  the  New  York  Central,  we  must  not  over¬ 
look  New  England’s  two  important  northern  gateways, 
one  via  the  Central  Vermont-Grand  Trunk  route  and 
the  other  via  the  Canadian  Pacific.  The  former  bisects 
New  England  from  the  Canadian- Vermont  line  to  tide¬ 
water  at  New  London,  cutting  all  our  east  and  west 
lines.  The  Canadian  Pacific  is  reached  by  the  Boston 
&  Maine  at  Newport,  Vermont,  and  freight  from 
eastern  and  northern  New  England  moves  to  Newport 


180 


chiefly  by  the  Boston  &  Maine  line  which  leaving 
Boston  passes  through  Lowell,  Nashua,  Manchester 
and  Concord  to  a  connection  with  the  Central  Vermont 
at  White  Biver  Junction  in  the  Connecticut  Valley 
or  further  north  to  the  Newport  connection  with  the 
Canadian  Pacific.  We  shall  refer  again  to  the  differ¬ 
ential  routes  through  these  two  northern  gateways. 
Suffice  it  to  say  now  that  the  interchange  of  New 
England’s  industries  through  these  two  northern  gate¬ 
ways  for  the  year  ending  June  30,  1922,  amounted  to 
61,754  loaded  cars  via  the  Central  Vermont  and  Grand 
Trunk  and  58,973  loaded  cars  via  the  Canadian  Pacific. 

Many  people,  even  New  Englanders,  if  they  are  not 
regular  shippers,  impressed  by  the  fact  that  these  lines 
run  through  New  England  almost  due  north,  think  of 
•them  as  roundabout  routes  to  Chicago  and  the  West, 
only  suitable  for  relatively  unimportant  and  low-grade 
merchandise,  hut,  as  a  matter  of  fact,  the  distance  from 
Boston  to  Chicago  by  the  Grand  Trunk  route  is  1129 
miles,  and  the  New  York  Central  route  is  only  108 
miles  shorter. 


181 


We  give  the  distance  from  Boston  to  Chicago  by  half 
a  dozen  of  the  established  routes,  having  joint  tariffs 
regularly  used  by  New  England  shippers: 


Boston  to  Chicago  —  Comparative  Distances 

Miles 

Boston  &  Maine,  New  York  Central — Wabash  989 

Boston  &  Maine,  New  York  Central  —  Nickel  Plate  1004 

Boston  &  Maine,  New  York  Central  (West  Shore)  1021 

Boston  &  Albany,  New  York  Central  1026 

Boston  &  Maine,  Delaware  &  Hudson — Delaware, 
Lackawanna  &  Western  —  Nickel  Plate  1061 

Boston  &  Maine,  Central  Vermont — Grand  Trunk 
Bailway  (via  Swanton  &  Coteau  Junction)  1129 

New  Haven  —  Pennsylvania  Railroad  1137 

Boston  to  Chicago  via  Boston  &  Maine,  Canadian  Pa¬ 
cific  Railroad  &  Michigan  Central  1189 

New  Haven  (via  Devon  &  Maybrook)  — Erie  1226 

New  Haven  —  Baltimore  &  Ohio  (freight  line)  1248 


The  Grand  Trunk  route  turns  westerly  about  3 
miles  north  of  St.  Albans,  Vermont,  and  does  not  go 
through  Montreal  or  through  any  big  terminals  or 
congested  points  anywhere  between  the  Vermont  line 
and  Chicago.  This  is  a  great  operating  advantage 
compared  with  traffic  over  the  New  York  Central 
which  moves  through  Albany,  Buffalo,  Cleveland,  and 
various  other  terminals  where  traffic  is  heavy  and  con¬ 
gestion  frequent.  Moreover,  the  Canadian  routes 
do  not  become  loaded  with  coal  during  the  winter 
months  when  the  going  is  hard  and  the  drawbar  pull  of 
the  locomotive  at  the  minimum  owing  to  cold. 


/ 

182 

Trunk  Line  Control  would  endanger 
Canadian  Gateways 

With  the  New  York  Central  in  control  of  the  Boston 
&  Maine,  Maine  Central,  and  Bangor  &  Aroostook,  the 
situation  would  be  exactly  that  contemplated  by  the 
Amendment  of  June  10,  1910  (36  St.  552)  to  the  Inter¬ 
state  Commerce  Act  as  amended  February  28,  1920 
(41  St.  485),  which  provides  that  the  Commission  shall 
not  in  establishing  a  through  route 
“  require  any  carrier  by  railroad,  without  its  consent, 
to  embrace  in  such  route  substantially  less  than  the 
entire  length  of  its  railroad  and  of  any  intermediate 
railroad  operated  in  conjunction  and  under  a  common 
management  or  control  therewith,  which  lies  between 
the  termini  of  such  proposed  through  route,  unless  such 
inclusion  of  such  lines  would  make  the  through  route 
unreasonably  long  as  compared  with  another  practic¬ 
able  through  route  which  could  otherwise  be  estab¬ 
lished.  ’  * 

It  has  been  suggested  that  in  the  event  of  a  consoli¬ 
dation  of  the  Boston  &  Maine  with  the  New  York 
Central  these  northern  routes  could  be  protected  by  an 
order  of  the  Interstate  Commerce  Commission  or  by 
some  collateral  agreement,  but  to  us  this  is  not  at  all 
reassuring.  It  is  by  no  means  certain  that  the  Com¬ 
mission  would  feel  warranted  under  such  an  order,  in 
disregarding  the  provisions  just  quoted  from  the 
statute,  nor  is  it  yet  clear  that  as  a  matter  of  law  it 
legally  could  do  so.  In  order  that  these  northern 
routes  may  be  successful  they  need  more  than  an  order 
or  a  formal  agreement  to  be  enforced  by  appeal  to  the 
Interstate  Commerce  Commission;  they  must  have 
sympathetic,  smooth,  prompt  and  regular  service. 


183 


Sympathetic,  responsive  and  effective  cooperation 
between  two  men  as  partners  cannot  often  be  secured 
by  a  written  agreement,  if  tbeir  self-interests  and  in¬ 
clinations  pull  in  opposite  directions. 

It  has  been  pointed  out  that  such  an  order  was 
entered  by  the  Interstate  Commerce  Commission  to 
protect  other  railroads  in  the  case  of  the  Chicago  Junc¬ 
tion  Railway  in  connection  with  its  acquisition  by  the 
New  York  Central  system.  But  we  note  that,  besides 
a  clearly  expressed  belief  on  the  part  of  the  other  rail¬ 
roads  that  this  stipulation  or  agreement  will  not  suffi¬ 
ciently  protect  them,  the  Pennsylvania  Company,  the 
Baltimore  and  Ohio,  the  Erie  and  four  other  com¬ 
panies  have  brought  suit  in  the  United  States  Circuit 
Court  in  an  endeavor  to  stop  this  consolidation.  This 
litigation  is  burdensome  and  expensive,  but  neverthe¬ 
less  has  been  begun  due  to  the  apprehension,  based  on 
the  plaintiff  companies’  experience  of  many  years  in 
practical  railroading,  that  somehow  or  other  the  re¬ 
lations  between  the  Chicago  Junction  Railway  and  the 
New  York  Central  system  are  going  to  slide  along  in 
an  easy  groove,  while  the  other  roads  are  going  to  be 
at  a  practical  disadvantage. 

President  Hustis  Emphasizes  importance  of 
Canadian  Gateways 

The  importance  of  the  Canadian  gateways  was 
pointed  out  and  emphasized  by  Mr.  J .  H.  Hustis,  Pres¬ 
ident  of  the  Boston  &  Maine,  in  his  testimony  before 
the  Interstate  Commerce  Commission  on  May  24th 
(Record,  pp.  8030-1)  : 

“  The  Boston  &  Maine  lias  a  substantial  interchange 


184 


with  the  Canadian  Pacific  direct  and  with  the  Grand 
Trunk  (now  the  Canadian  National  Railways)  through 
the  Central  Vermont.  New  England  traffic  is  regarded 
as  attractive  by  both  of  these  lines,  and  a  high  quality 
of  service  is  maintained  through  these  northern  gate¬ 
ways,  which  has  probably  been  quite  as  effective  in 
maintaining  the  popularity  of  these  routes  as  have  the 
westbound  differential  rates.” 

“  In  any  event,  and  in  any  plan  which  may  be 
adopted,  the  importance  of  these  routes  not  only  to 
New  England  but  to  the  Boston  &  Maine  will,  of 
course,  be  recognized.” 

President  Pearson  on  Effect  of  Trunk  Line 
Control  upon  Free  Routing  of  New  England  Traffic 

That  these  Canadian  connections  as  well  as  the 
present  equality  of  treatment  for  all  trunk  lines  at  the 
various  gateways  would  be  jeopardized  by  a  trunk  line 
consolidation  is  clearly  the  opinion  of  President  Pear¬ 
son  of  the  New  Haven,  who  testified  before  the  Com¬ 
mission  in  Washington  (Record,  p.  8141)  : 

“  Assuming  consolidation  between  the  New  Haven 
and  a  trunk  line,  this  would  inevitably  result  in  an 
attempt  to  control  the  movement  of  traffic  and  restrict 
it  as  against  other  gateways  and  other  routes.” 

“  Privileges  of  shippers,  heretofore  enjoyed  freely, 
would  become  restricted  in  part  by  the  provisions  of 
the  Interstate  Commerce  Act,  permitting  a  system  to 
refuse  to  short  haul  itself,  and  in  addition,  shippers 
would  gradually  find  themselves  under  new  influences. 
The  tendencies  could  not  be  other  than  restrictive,  in 


185 

the  desire  to  secure  all  of  the  traffic  possible  for  the 
consolidated  system.” 

(Record,  p.  8143.)  “  Inflexibility  would  gradually 

come  about  in  respect  to  rates  divisions,  etc.,  other 
than  those  confined  to  the  consolidated  system.  The 
use  by  Hew  England  of  any  and  all  routes,  water  as 
well  as  rail,  would  almost  surely  suffer  restriction  in¬ 
stead  of  encouragement  as  now.” 

(Record,  pp.  8144-8145.)  “  It  has  been  assumed  that 
with  respect  to  the  New  England  section  of  a  consoli¬ 
dated  system,  it  could  be  placed  under  the  requirement 
to  continue  to  serve  the  public  in  all  matters  as  hereto¬ 
fore.” 

1  ‘  If  this  is  the  case,  it  is  apparently  the  thought  that 
the  trunk  lines  which  consolidated  with  the  New 
England  system  would  forego  certain  advantages  and 
rights  but  would  assume  the  financial  obligation.  Is 
this  reasonable?  Should  a  trunk  line,  for  example, 
merge  the  New  Haven,  is  it  conceivable  that  terminal 
service  for  the  other  trunk  lines  would  thereafter  re¬ 
ceive  the  same  treatment  as  now?  Does  the  history  of 
railroads  bear  evidence  of  such  instances  of  altruism? 
Is  this  contemplated  by  the  Transportation  Act?  ” 

“  Can  it  be  conceived  that  other  connecting  carriers 
would  anticipate  such  a  situation  with  equanimity? 
Would  they  not,  and  in  all  fairness  to  their  point  of 
view  should  they  not,  as  in  the  recent  case  of  the  Belt 
Line  in  Chicago,  take  into  the  courts  those  questions 
relating  to  the  probable  restriction  of  their  free  open 
opportunity  to  receive  hereafter  that  charactei  of  ter- 
minal  service  in  New  England  that  they  have  enjoyed 
heretofore?” 


186 


View  of  President  Todd 

President  Percy  R.  Todd,  of  the  Bangor  &  Aroos¬ 
took,  who  was  formerly  General  Traffic  Manager  of 
the  West  Shore  Railroad  and  later  Vice-President 
of  the  New  Haven,  and  in  a  varied  railroad  career  has 
an  unusual  knowledge  based  upon  practical  experience 
with  New  England  transportation  conditions,  gave 
some  valuable  testimony  before  the  Interstate  Com¬ 
merce  Commission  in  Washington  on  May  25th. 
Speaking  primarily  from  the  standpoint  of  his  own 
company,  not  so  much  on  the  basis  of  the  interest  of 
its  security  holders  as  upon  that  of  the  public  served 
by  it,  he  said  (Record,  p.  8227)  : 

“  System  No.  1. — At  the  present  time  shippers  on 
the  line  of  the  Bangor  &  Aroostook  Railroad  forward 
a  great  deal  of  freight  to  Central  Freight  Association 
territory,  and  have  open  to  them  through  our  connec¬ 
tion  with  the  Canadian  Pacific  at  Brown ville  Junction, 
excellent  service,  and  sometimes  slightly  lower  rates 
than  by  other  routes,  and  if  they  do  ship  via  the  Maine 
Central  Railroad  through  our  connection  at  Northern 
Maine  Junction,  have  the  choice  of  many  different 
routes  to  the  west  ” —  (of  which  he  enumerated  and 

described  ten)  “ . whereas  it  is  natural  to 

assume  that  if  consolidation  was  made  under  System 
No.  1  idtimately  the  traffic  would  have  to  be  confined 
to  the  New  York  Central  System,  for  the  reason  that 
there  can  be  no  possible  object  in  the  New  York  Cen¬ 
tral  or  any  other  trunk  line  acquiring  ownership 
through  consolidation  with  any  of  the  present  inde- 


187 


pendent  New  England  railroads,  none  of  which  ex¬ 
cept  the  Bangor  &  Aroostook  are  financially  strong, 
and  which  acquisition  would  undoubtedly  involve  the 
trunk  lines  in  assuming  financial  liabilities  on  behalf 
of  the  New  England  Railroads  acquired,  unless  they 
hope  to  offset  these  financial  obligations  by  monopoliz¬ 
ing  the  traffic  to  and  from  New  England,  and  thereby 
make  up  in  revenue  more  than  sufficient  to  offset  these 
deficits  which  certainly  would  not  be  to  the  interest  of 
the  New  England  public.” 

Then  extending  his  comments  as  to  the  effect  of 
trunk  line  consolidation  (as  embodied  in  the  Commis¬ 
sion’s  alternative  tentative  plans — “  System  No.  1  — 
New  York  Central,”  giving  the  Boston  &  Maine  to  the 
New  York  Central,  “System  No.  3  —  Baltimore  & 
Ohio,”  allocating  the  New  Haven  Railroad  to  the  Bal¬ 
timore  &  Ohio,  and  “  System  No.  7 A — New  England- 
Great  Lakes,”  setting  up  a  new  trunk  line  system  he 
observed  (Record,  p.  8229)  : 

“  The  above  statements  ”  (those  just  quoted)  “  refer 
to  the  interests  only  of  the  public  served  by  the  Bangor 
&  Aroostook  Railroad,  but  it  is  our  feeling  that  the 
same  is  true,  possibly  to  even  a  greater  degree,  of  the 
New  England  public  generally  in  that  portion  of 
Maine  not  served  by  the  Bangor  &  Aroostook,  and  in 
the  other  New  England  States,  as  no  other  object 
than  that  of  monopolizing  the  traffic  can  be  conceived 
for  any  trunk  line  being  willing  to  invest  large 
sums  of  money  in  acquiring  one  or  more  of  the  New 
England  railroads,  and  becoming  financially  respon¬ 
sible  for  their  obligations;  the  interest  on  the  money 
invested  on  such  acquisition,  and  the  money  required 


188 


for  meeting  obligations  of  tbe  New  England  roads, 
with  which  consolidation  is  effected,  must  come  from 
some  source,  and  what  possible  way  is  there  of  realiz¬ 
ing  that  money  by  the  trunk  lines  except  by  securing 
a  greater  share  of  traffic  to  and  from  New  England 
than  such  trunk  lines  have  heretofore  enjoyed.” 

“  While  the  question  of  freight  rates  is  always  a 
vital  one,  it  is  well  known  that  in  recent  years  the  pub¬ 
lic  has  placed  good  service  ahead  of  low  rates,  and  with 
the  general  New  England  public  having  at  the  present 
time  at  least  ten  outlets  to  and  from  the  west,  it  is  a 
natural  assumption  that  with  the  number  of  outlets 
decreased,  and  to  some  extent  a  monopoly  substituted, 
the  service  will  not  be  as  good  as  it  is  under  the  present 
conditions.” 


Differential  Routes  to  West  and  South  would 

BE  ENDANGERED  BY  TRUNK  LlNE  CONSOLIDATION 

It  is  also  true  that  New  England,  as  we  have  previ¬ 
ously  explained,  has  various  vital  differential  routes 
by  water  and  rail  to  the  west  and  southwest,  particu¬ 
larly  through  Baltimore  and  Savannah,  which  may 
find  their  usefulness  and  ability  to  obtain  cargoes  di¬ 
minished,  because  the  New  York  Central  management 
in  the  long  run  would  find  its  interests  more  directly 
concerned  in  moving  merchandise  destined  for  any 
point  south  or  west  out  of  the  central  or  northern  half 
of  New  England,  by  its  own  standard  full-price,  all¬ 
rail  route. 


189 


Boston  &  Maine  should  not  be  dismembered 

In  his  discussion  of  the  northern  New  England  sit¬ 
uation,  Professor  Ripley  intimated,  as  an  incidental 
feature  of  a  Boston  &  Maine  consolidation  with  the 
Erie,  a  possibility  of  first  cutting  out  from  the  heart  of 
the  Boston  &  Maine  its  line  from  Worcester,  through 
New  Hampshire  to  Portland  —  originally  the  Worces¬ 
ter,  Nashua  &  Rochester  —  and  assigning  that  line,  to¬ 
gether  with  the  Maine  Central  and  the  Bangor  &  Aroos¬ 
took,  to  the  New  York  Central.  No  such  suggestion 
should  for  a  moment  be  entertained.  It  would  fatally 
weaken  the  Boston  &  Maine  and  precipitate  immedi¬ 
ately  the  financial  debacle  likely  in  any  event  to  follow 
the  consolidation  of  the  weak  Erie  with  the  already 
sufficiently  weak  Boston  &  Maine  even  without  having 
subjected  the  latter  to  this  proposed  major  excision  of 
one  of  its  vital  parts.  Far  better  would  it  be  to  turn 
all  these  northern  roads,  including  the  Boston  &  Maine, 
over,  once  for  all,  to  the  New  York  Central. 

Tentative  Alternative — “System  7 A — New 
England-Great  Lakes  ” 

In  regard  to  the  other  alternative  consolidation  pro¬ 
posed  by  the  Interstate  Commerce  Commission  in  its 
tentative  plan,  designated  as  “System  7a  —  New 
England-Great  Lakes,”  providing  for  the  consolida¬ 
tion  of  the  New  England  lines  with  the  Delaware  & 
Hudson,  the  Delaware,  Lackawanna  &  Western,  Buf¬ 
falo,  Rochester  &  Pittsburgh  and  certain  smaller  roads, 
no  one  has  seriously  urged  it.  Its  weaknesses  were 


190 


pointed  out  in  the  statement  of  William  S.  Jenney, 
Counsel  for  the  Delaware,  Lackawanna  &  Western 
Railway  Company,  before  the  Interstate  Commerce 
Commission  in  Washington  at  the  hearing  on  May  17, 
and  we  agree  with  his  conclusion  that  the  objections  to 
it  are  insuperable.  We  give  in  Appendix  Q  a  portion 
of  Mr.  Jenney ’s  statement. 

Disposition  of  Rutland  Railroad 

With  regard  to  the  disposition  of  the  Rutland  Rail¬ 
road  it  should  be  noted  that  Professor  Ripley  has  sug¬ 
gested  that  it  be  consolidated  with  the  New  York  Cen¬ 
tral  system,  as  does  the  Commission  also,  affirmatively 
in  its  “  System  No.  1  —  New  York  Central,”  and  neg¬ 
atively  in  its  “  System  No.  7  —  New  England  ”  and 
“System  No.  7a  —  New  England-Great  Lakes,”  by 
including  it  in  neither  of  those  tentative  systems.  In 
the  proceeedings  before  the  Interstate  Commerce  Com¬ 
mission  at  Washington,  Mr.  A.  H.  Smith,  President  of 
the  New  York  Central,  said  (printed  statement,  p.  12). 
“  we  are  willing  to  accept  the  Rutland  although  we 
have  not  shown  it  on  the  map  of  our  proposed  plan.  ’  ’ 

At  present  the  control  of  the  Rutland  is  owned 
jointly  by  the  New  York  Central  and  the  New  Haven 
railroads,  these  two  roads  having  an  equal  interest  in 
51  per  cent  of  its  capital  stock,  and  we  think  it  vital 
that  this  joint  interest  should  remain  or  at  least  that 
New  England  should  remain  as  a  partner  in  this  road. 

In  the  opinion  of  the  committee,  consolidation  of  the 
Rutland  with  the  New  York  Central  at  the  present 
time  would  be  unfortunate,  for,  in  the  event  that  it 


191 


proves  possible  to  reconstruct  the  New  England  rail¬ 
roads  so  that  a  New  England  consolidation  may  be 
ultimately  effected,  a  part  ownership  in  the  Rutland 
Railroad  would,  in  the  opinion  of  the  Committee,  be  of 
importance  in  this  New  England  system.  It  provides 
a  differential  route  to  the  West  via  the  Lakes  from 
New  England.  The  route  is  via  the  old  Cheshire  Rail¬ 
road  from  Fitchburg  to  Bellows  Falls,  which  is  in  excel¬ 
lent  condition,  and  from  Bellows  Falls,  via  the  Rutland, 
to  Ogdensburg.  With  the  enlargement  of  the  Welland 
Canal,  the  Rutland  would  also  have  new  possibilities 
for  export  grain  movement  from  Ogdensburg,  via  the 
Boston  &  Maine  at  Bellows  Falls,  which,  in  the  hands 
of  an  aggressive  New  England  railroad  management, 
should  be  able  to  add  materially  to  the  export  grain 
traffic  through  the  port  of  Boston. 


Argument  for  Trunk  Line  Consolidation 

The  fact  is  that  so  far  at  least  as  the  welfare  of  New 
England  is  concerned,  the  only  argument  that  has  been 
put  forth  with  any  emphasis  in  favor  of  trunk  line 
consolidation  has  been  the  financial  argument.  This 
has  been  set  forth  ably  by  Mr.  John  E.  Oldham,  who 
has  performed  a  public  service  in  studying  and  elabo¬ 
rating  this  side  of  the  question.  Mr.  Oldham  appeared 
before  this  Committee  and  gave  us  the  benefit  of  his 
thorough  study  of  this  question,  and  Mr.  Charles  A.  An¬ 
drews,  his  associate,  also  presented  an  able  argument 
on  the  financial  side  of  the  question.  Mr.  Oldham  dealt 
with  the  Committee  with  straightforward  frankness, 
and  stated  that  his  conclusion  had  not  taken  into  ac- 


192 


count  the  operating  policies  or  the  present  manage¬ 
ment  of  either  the  New  Haven  or  the  Boston  &  Maine 
railroads.  He  pointed  out  certain  general  operating 
disadvantages,  chiefly  the  relatively  high  cost  of  fuel 
in  New  England,  and  the  relatively  short  haul,  and 
the  large  terminal  expenses,  which  he  felt  were 
materially  unfavorable  factors.  Certainly  the  New 
England  handicap  in  regard  to  these  factors  cannot  be 
gainsaid. 

A  New  England  System  Preferred 

This  Committee  has  reached  the  conclusion  that  if 
financial  considerations  permit,  the  welfare  of  New 
England  can  be  better  served  by  a  consolidation  of  the 
New  England  systems,  leaving  out  the  Boston  &  Al¬ 
bany,  Central  Vermont,  and  the  Grand  Trunk  Line  to 
Portland,  and  the  small  Canadian  Pacific  mileage  in 
Maine  and  Northern  Vermont. 

This  system  is  outlined  in  the  Interstate  Commerce 
Commission’s  “  Plan  No.  7  —  New  England,”  but 
should,  as  we  have  already  indicated,  include  joint 
ownership  with  the  New  York  Central  in  the  Rutland 
Railroad.  In  this  Committee’s  opinion  to  retain  in 
this  “  System  7  —  New  England  ”  the  two  small  so- 
called  Bridge  Lines  —  the  Lehigh  &  New  England  and 
the  Lehigh  &  Hudson  River  —  is  not  so  vital.  Not  only 
do  we  think  such  a  New  England  Consolidation  in  the 
interest  of  New  England  shippers  but  we  think  it  is 
equally  in  the  interest  of  the  consignees  at  the  other  end 
who  are  receiving  merchandise  originating  in  New 
England,  and  also  of  the  shippers  outside  of  New  Eng- 


193 


land  wlio  wish  to  send  the  product  of  their  farms, 
mines  or  factories  into  New  England. 

New  England  would  like  to  wear  its  own  breeches. 
We  submit  that  it  should  be  allowed  to  do  so  unless  a 
clear  case  can  be  made  out  why  one  leg  should  be 
handed  over  to  the  Pennsylvania  Railroad,  or  the  Bal¬ 
timore  and  Ohio,  and  the  other  to  the  New  York 
Central. 


Railroad  Management  in  New  England  Must  be 
Sympathetic  to  Development  of 
New  England  Seaports 

The  indented  shore  line  of  New  England,  and  its 
many  harbors,  with  population  and  industries  gathered 
directly  on  or  within  a  few  miles  of  the  shore,  give 
New  England  a  special  interest  and  compel  a  special 
policy,  if  New  England  is  to  continue  to  flourish. 

A  New  England  system  offers  in  many  respects  the 
best  hope  for  these  seven  and  a  half  million  people. 
We  must  have  and  must  properly  maintain  our  rail¬ 
roads,  but  up  here  in  the  corner  the  greatly  enhanced 
cost  of  rail  transportation  is  going  to  “  get  ”  us  unless 
we  can  operate  our  railroads  so  as  to  take  day  by  day 
the  utmost  advantage  of  our  sea  possibilities. 

Is  it  practical,  is  it  safe,  to  expect  a  New  York  Cen¬ 
tral  or  a  Pennsylvania  management  to  lay  this  to  heart 
and  keep  it  there  day  by  day?  We  must,  without  the 
slightest  tinge  of  criticism,  deal  with  the  ordinary 
springs  of  human  action.  Might  not  the  directors  of 
these  two  roads  looking  out  of  the  windows  of  their 
meeting  rooms  understand  better,  and  be  more  dis- 


194 


posed  sympathetically  to  cooperate  with,  the  needs  of 
the  port  of  New  York  and  the  port  of  Philadelphia 
than  of  Portland  or  Boston  or  Providence  or  New 
London  ?  So  far  as  the  Pennsylvania  Railroad  is  con¬ 
cerned  in  port  development,  Philadelphia  and  New 
York  must  inevitably  be  the  magnets  to  attract  their 
thought  and  their  capital,  and  the  port  of  New  York 
cannot  help  in  the  long  run  being  a  greater  object  of 
solicitude  to  the  New  York  Central  officials  than  the 
port  of  Boston. 

These  New  England  seaports  are  to  us  not  part  of  a 
surplus  stock  in  trade  —  they  are  our  chief  stock  in 
trade,  and  essential  to  our  livelihood. 

The  development  to  the  utmost  of  this  single  eco¬ 
nomic  advantage  possessed  by  the  people  living  in 
New  England  is  not  in  any  way  prejudicial  to  the 
welfare  and  interests  of  this  country  as  a  whole. 
Neither  does  the  national  welfare  nor  a  national  rail¬ 
road  policy  require  the  uprooting  of  the  interests  of 
any  large  body  of  citizens  anywhere  in  this  country; 
the  problem  rather  is  how  to  make  the  railroads  con¬ 
tribute  the  utmost  good  to  each  large  group  of  Amer¬ 
ican  citizens  whether  on  the  Atlantic  seacoast,  or  the 
Pacific  seacoast,  the  Great  Lakes  or  elsewhere  in  the 
country. 

We  think  it  is  clear  that  unless  there  is  a  compelling 
financial  reason  there  is  no  advantage  either  to  New 
England  or  any  other  part  of  the  country  in  consolidat¬ 
ing  the  New  England  railroads  with  the  trunk  lines. 
Do  the  shorter  haul,  the  enhanced  cost  of  fuel,  and  the 
other  operating  disadvantages  of  the  New  England 
rail  carriers,  constitute  a  compelling  reason  ? 


195 


New  England's  Adverse  Per  Diems 

The  change  from  a  mileage  to  a  per  diem  basis  for 
the  use  of  freight  cars,  and  the  gradual  rise  in  the  rate 
until  it  reached  a  dollar,  created  one  of  the  most  seri¬ 
ous  adverse  factors  in  the  New  England  railroad  situ¬ 
ation.  Its  effects  have  been  profound.  The  change 
was  in  the  interests  of  general  economy  and  efficiency, 
and  therefore  sound  for  the  country  as  a  whole,  but 
it  introduced  an  entirely  new  situation  in  New  Eng¬ 
land.  The  short  haul,  the  multiplicity  of  branches, 
junction  points  and  terminals,  which  have  caused  New 
England  to  be  described  as  having  rather  the  character 
of  a  great  terminal,  produce  necessarily  a  slowing  of 
car  movement  in  New  England  and  impose  therefore 
a  heavy  adverse  per  diem  burden.  The  line-haul  is  the 
really  profitable  part  of  railway  operation.  There  is 
no  question  but  that  the  introduction  of  the  per  diem 
and  the  rise  in  the  rate  until  it  reached  the  present 
level  of  a  dollar  a  day  put  New  England  at  a  serious 
disadvantage.  The  adverse  per  diem  balances  of  cer¬ 
tain  of  the  New  England  roads  during  the  year  1922 
amounted  to  $8,833,185,  and  the  credit  balances  of 
the  three  creditor  roads  amounted  only  to  $422,266. 

Rate  Divisions,  Based  on  New  England's  Operating 

Disabilities,  Work  toward  same  Benefits 
as  Would  Consolidation  with  Strong  Roads 

The  purpose  of  the  Transportation  Act  can  only  be 
accomplished  in  many  and  we  suppose  in  most  parts 
of  the  country  by  consolidations  such  as  are  discussed 


196 


in  the  Ripley  report.  If  the  financially  weaker  lines 
must  be  maintained  for  the  benefit  of  the  people  who 
depend  upon  them,  and  if  the  policy  of  the  government 
is  to  maintain  equal  rates  for  equal  service  without 
permitting  some  roads  to  operate  at  too  great  profit 
and  others  at  insufficient  profit,  the  object  sought  can 
be  gained  only  in  most  sections  of  the  country  by  a 
consolidation  of  the  weaker  roads  with  the  stronger. 

In  the  case  of  the  New  England  railroads  their 
geographical  location,  set  off  as  they  are  in  the  north¬ 
east  corner  of  the  country,  with  none  of  them  reaching 
substantially  west  of  the  Hudson  River,  there  remains 
another  method  of  maintaining  the  national  policy  of 
equal  rates,  without  permitting  these  roads  if  they 
are  consolidated  into  a  New  England  system  to  earn 
either  too  much  or  too  little.  The  way  has  been  found ; 
moreover  it  has  been  put  into  effect  already  by  the 
Interstate  Commerce  Commission.  It  has  been  de¬ 
clared  also  by  the  Supreme  Court  to  be  legal  and  with¬ 
in  the  existing  powers  of  the  Interstate  Commerce 
Commission.  This  recent  decision  of  the  Interstate 
Commerce  Commission,  sustained  by  the  Court,  or¬ 
dered  a  new  division  of  rates  between  the  New  Eng¬ 
land  railroads  and  the  trunk  lines.  It  is  true  that 
this  action  established  a  diversion  of  income  from  the 
trunk  lines  to  the  New  England  lines,  but  so  will  the 
consolidation  feature  of  the  Transportation  Act  if  that 
feature  of  the  Act  is  ever  made  mandatory.  We  see 
no  difference  in  result.  This  plan  is  now  in  effect  so 
far  as  the  New  England  roads  are  concerned,  and  we 
see  no  necessity  and  no  reason  based  on  public  wel¬ 
fare  for  destroying  it  and  starting  another  policy. 


197 


We  do  not  say  this  because  we  happen  to  live  in  New 
England  but  because  these  New  England  roads  are 
tucked  away  beyond  the  Hudson  River  in  one  homo¬ 
geneous  corner  of  the  country. 


Trunk:  Line  Consolidation  a  Last  Resort 

The  great  majority  of  the  inhabitants  of  New  Eng¬ 
land  do  not  want  trunk  line  consolidation;  they  do 
not  believe  that  national  interests  require  it,  and  they 
do  not  believe  it  is  best  for  the  development  of  this 
portion  of  the  country.  We  think  New  England  has 
too  long  a  record  and  has  shown  too  many  times,  whether 
in  war  or  peace,  its  desire  to  contribute  to  the  national 
welfare,  whether  it  happened  to  be  to  the  immediate 
interest  of  New  England  or  not,  to  permit  the  charge 
to  be  successfully  made  that  in  this  matter  it  is  seeking 
to  obtain  for  itself  a  benefit  which  in  any  respect  is 
hostile  to  the  interest  of  the  country  as  a  whole.  On 
the  contrary,  the  development  of  each  and  every  group 
of  states  in  this  country  to  the  utmost  possibility  is  in 
the  interest  of  all  the  states,  and  this  doctrine  applies 
to  the  question  before  us. 


The  Question  of  Competition 

The  importance  of  competition  has  been  recognized 
by  Congress,  which  directed  in  the  Transportation  Act 
of  1920,  that  in  setting  up  proposed  consolidations 
11  competition  shall  be  preserved  as  fully  as  possible.” 


198 


Whatever  competition  of  a  substantial  sort  now 
exists  in  New  England  railroading  is  between  one  or 
another  of  the  strictly  New  England  roads  and  the 
New  York  Central  (Boston  &  Albany),  the  Grand 
Trunk  (Central  Vermont)  or  the  Canadian  Pacific. 
All  this  would  he  preserved  under  the  proposed  New 
England  consolidation.  As  among  those  roads  which 
have  been  designated  to  form  a  possible  New  England 
system,  competition  does  not  now  exist  in  any  substan¬ 
tial  amount.  Each  road  serves  a  territory  into  which 
none  of  the  other  New  England  roads  penetrate  to  an 
appreciable  extent — with  the  single  exception  that 
there  is  a  fringe  of  towns  and  cities  along  the  southern 
border  of  the  Boston  &  Maine  and  the  northern  border 
of  the  New  Haven  which  are  served  by  both.  This 
fringe  is  for  the  most  part,  and  under  a  New  England 
consolidation  would  continue  to  he,  served  by  the  strong 
and  efficient  New  York  Central  system  (Boston  &  Al¬ 
bany). 

The  real  railroad  competition  of  value  to  New  Eng¬ 
land,  and  which  it  is  important  to  preserve,  is  in  the 
transportation  facilities  furnished  from  the  western 
and  northern  New  England  boundaries  to  other  por¬ 
tions  of  the  United  States  and  to  Canada.  With  the 
assurance  of  a  reasonable  public  control,  in  the  interest 
of  the  maintenance  and  development  of  New  England 
industrial  activities,  competition  within  New  England 
is  distinctly  secondary  in  importance  to  the  New  Eng¬ 
lander  provided  he  has  the  choice  (which  with  the  uni¬ 
fied  New  England  system  he  would  have)  among  the 
various  New  England  gateways  and  the  routes  avail¬ 
able  through  them. 


199 


Transportation  Act  Does  Not  Make  Consolidation 

Compulsory 

The  Committee,  of  course,  recognizes  that  the  adop¬ 
tion  of  any  consolidation  plan  by  the  Interstate  Com¬ 
merce  Commission  under  the  provisions,  relative  to 
consolidation,  contained  in  the  Transportation  Act  of 
1920,  does  not  necessarily  result  either  in  an  immediate 
or  even  ultimate  consolidation  in  accordance  with  the 
plan  adopted.  Except,  however,  as  that  plan  may,  upon 
application,  be  subsequently  modified  by  the  Commis¬ 
sion,  no  consolidation  can  be  effected  which  does  not 
conform  to  it.  Furthermore,  the  statute  is  mandatory 
upon  the  Commission  to  adopt  a  plan  and  this  it  must 
do  with  reasonable  diligence.  It  is  this  situation  which 
creates,  in  the  opinion  of  the  Committee,  the  necessity 
of  the  consideration  given  in  this  report  to  various 
possible  consolidations  and  the  necessity  of  the  adop¬ 
tion  for  the  New  England  States,  and  the  New  Eng¬ 
land  public,  of  that  form  of  consolidation  which  seems 
to  them  best  adapted  to  their  continued  prosperity  and 
development  and  consequently  the  best  for  all  other 
sections  of  the  country  with  whose  prosperity  and  de¬ 
velopment  ours  in  New  England  is  so  closely  hound  up. 

Interstate  Commerce  Commission ’s  ‘  ‘  System  No.  7 — • 
New  England  ”  Best  for  New  England 

The  Committee  does  not  recommend  at  the  present 
time  any  further  consolidation  either  of  the  New  Eng¬ 
land  railroads  among  themselves  or  between  any  of 
them  and  any  of  the  trunk  lines  or  other  railroad  sys¬ 
tems.  It  seems  sufficient  now  to  indicate  merely  what 


200 


kind  of  consolidation  is  best  so  that  if  at  any  time  in 
the  future  further  consolidations  are  desired,  they  may 
be  along  lines  in  harmony  with  the  expressed  prefer¬ 
ence  of  New  England. 

As  already  indicated,  the  Committee  believes  that  the 
Interstate  Commerce  Commission’s  System  No.  7,  with 
minor  modifications,  is  the  best  for  New  England.  This 
system  would  consist  of  the  Bangor  &  Aroostook,  the 
Maine  Central,  the  Boston  &  Maine,  and  the  New  York, 
New  Haven  &  Hartford  railroads,  and  their  controlled 
fines,  including  the  New  York,  Ontario  &  Western  and 
the  Central  New  England,  and  at  least  an  equal  interest 
with  the  New  York  Central  in  the  Rutland  Railroad. 
While  the  Commission  included  the  two  so-called 
bridge  fines,  the  Lehigh  &  Hudson  River  and  the  Le¬ 
high  &  New  England,  the  Committee  is  of  the  opinion 
that  neither  of  these  fines  is  essential  provided  their 
present  relation  to  New  England  fines  is  not  substan¬ 
tially  changed. 

If  a  New  England  system  should  eventually  be  es¬ 
tablished,  leaving  out  the  Boston  &  Albany  and  the 
Central  Vermont,  it  is  clear  that  the  inclusion  of  the 
Bangor  &  Aroostook,  the  Maine  Central,  the  Rutland, 
and  the  New  York,  Ontario  &  Western  would  present 
no  financial  problems  of  consequence  in  addition  to  the 
problems  involved  in  the  rehabilitation  of  the  New 
Haven  and  the  Boston  &  Maine.  These  four  roads  will 
all  at  least  care  for  their  fixed  charges.  The  Bangor  & 
Aroostook  is  paying  dividends  on  both  its  common  and 
preferred  stock,  and  the  Maine  Central  though  getting 
a  bad  start  in  January  and  February  is  a  sound,  well 
managed  property. 


201 


The  Proposed  New  England  System  Compared  with 
Other  Railroad  Systems 

Such  a  New  England  System,  if  and  when  put  to¬ 
gether,  would  constitute  a  compact  railroad,  comparing 
favorably  in  mileage,  revenues,  volume  of  traffic,  both 
passenger  and  freight,  with  the  existing  railroads  of 
the  country  as  well  as  with  several  of  the  proposed 
consolidated  systems  under  the  Interstate  Commerce 
Commission’s  tentative  plan.  It  would  have  7,612 
miles  of  line,  the  aggregate  earnings  of  which  in  the 
year  1922  were  $258,253,750. 


202 

The  following  table  gives,  for  purposes  of  comparison, 
1922  gross  revenues  of  the  present  larger  railroads  of 
the  United  States,  including  their  principal  subsidia¬ 


ries  : 

Gross 

Revenues 

Pennsylvania  . $699,489,929 

New  York  Central  .  574,590,294 

Southern  Pacific .  260,979,957 

New  England  System  (N.H.,  B.  &  M.,  Me.  C., 


Atchison,  Topeka  &  Santa  Fe .  225,124,544 

Baltimore  &  Ohio .  203,959,372 

Illinois  Central  .  198,028,369 

Union  Pacific  .  196,048,716 

Chicago,  Burlington  &  Quincy  .  189,072,034 

Southern  .  183,162,171 

Chicago  &  Northwestern  .  173,901,444 

Chicago,  Milwaukee  &  St.  Paul .  156,950,628 

Louisville  &  Nashville  .  146,768,778 

Chicago,  Rock  Island  &  Pacific .  125,086,233 

Erie  .  112,565,748 

Great  Northern  .  103,452,937 

Missouri  Pacific  .  99,921,331 

Northern  Pacific .  96,076,067 

Norfolk  &  Western  .  90,314,743 

Chesapeake  &  Ohio  .  83,511,561 

St.  Louis  —  San  Francisco .  83,008,023 

Delaware,  Lackawanna  &  Western  .  74,873,605 

Atlantic  Coast  Line  .  74,044,589 


It  will  be  seen  that  of  these  23  systems  the  New  Eng¬ 
land  roads,  if  taken  together  and  reckoned  as  one  sys¬ 
tem  with  revenues  combined,  would  be  fourth  in  re¬ 
spect  to  revenue. 


203 


The  following  table  gives  a  similar  comparison  be¬ 
tween  the  proposed  New  England  System,  as  suggested 
by  the  Committee,  with  each  of  the  other  systems  de¬ 
scribed  in  the  Commission’s  tentative  plan,  omitting, 
however,  from  “  System  No.  1 — New  York  Central,” 
the  Boston  &  Maine,  the  Maine  Central,  the  Bangor  & 
Aroostook  and  the  Rutland,  and  from  “  System  No.  3 
—  Baltimore  &  Ohio,”  the  New  York,  New  Haven  & 
Hartford  and  Central  New  England: 

Gross 

Revenues 


System 

2  Pennsylvania  . $696,983,478 

1  New  York  Central  (Excluding  New  Eng¬ 
land  Lines)  .  578,381,963 

17  Southern  Pacific  —  Rock  Island .  416,490,758 

13  Union  Pacific  —  Northwestern  .  371,023,658 

3  Baltimore  &  Ohio  (Excluding  New  Haven)  362,443,933 

14  Burlington  —  Northern  Pacific .  309,400,750 

16  Santa  Fe .  304,236,707 

4  Erie  .  303,027,136 

15  Milwaukee  —  Great  Northern .  284,804,897 


11  Atlantic  Coast  Line  —  Louisville  &  Nash¬ 
ville  .  278,944,431 


7  New  England  (Committee’s  recommenda¬ 

tion)  . 

12  Illinois  Central— Seaboard . 

19  Chicago  —  Missouri  Pacific  . 

18  Frisco  —  Katy  Cotton  Belt  . 

10  Southern  . 

5  Nickel  Plate  —  Lehigh  Valley . 

8  Chesapeake  &  Ohio  . 

9  Norfolk  &  Western  . 

6  Pere  Marquette . 


258,253,750 

249,173,976 

212,071,998 

192,731,019 

190,355,309 

149,699,199 

116,376,470 

106,970,629 

54,807,948 


204 


New  England  would  be  submerged  in  Enlarged 

Pennsylvania  and  New  York  Central  Systems 

It  will  be  seen  from  this  comparison  that  the  New 
England  group  would  rank  eleventh  in  gross  revenue 
among  the  19  consolidated  systems  proposed  in  the  ten¬ 
tative  plan  of  the  Interstate  Commerce  Commission. 
It  would  be  almost  as  large  as  systems  6,  8,  and  9 
combined. 

Should,  however,  the  alternative  suggestion  of  trunk 
line  consolidation  be  adopted  and  the  four  northern 
New  England  roads  be  included  in  System  No.  1,'New 
York  Central,  that  system  would  become  unduly,  if  not 
menacingly,  large.  It  would  then  have  17,239  miles  of 
railroad  and  $694,256,409  of  revenue,  exceeding  in  each 
respect  any  of  the  other  proposed  consolidated  systems, 
except  that  of  the  Pennsylvania.  While  the  Commis¬ 
sion  has  suggested  as  an  alternative  to  a  New  England 
System  the  inclusion  of  the  New  York,  New  Haven  & 
Hartford  in  “  System  No.  3  —  Baltimore  &  Ohio,”  the 
Committee  feels  that  this  would  be  an  unnatural  and  un¬ 
fortunate  combination.  The  objections  to  it  have  al¬ 
ready  been  discussed  earlier  in  this  report.  Assuming 
the  Committee’s  conclusions  in  this  respect  to  be  well 
taken  and  assuming  further  that  the  plan  of  a  New 
England  System  is  to  be  rejected,  the  Committee 
thinks  that  the  only  reasonable  trunk  line  consoli¬ 
dation  for  the  New  Haven  system  is  with  the  Penn¬ 
sylvania.  Here  again,  however,  there  would  result, 
as  in  the  case  of  adding  the  Boston  &  Maine 


205 


to  the  New  York  Central,  an  over-extended  super 
system,  exceeding  in  size  the  New  York  Central  with 
the  addition  of  the  Northern  New  England  roads. 
Such  a  swollen  Pennsylvania  System  would  embrace 
14,239  miles  of  railroad  and  would  have  had  in  1922  a 
revenue  of  $827,020,870. 

The  railroads  suggested  for  a  New  England  consoli¬ 
dation  represent  5  per  cent  of  the  total  gross  railroad 
revenue  of  the  country.  If  turned  over  in  part  to 
such  an  enlarged  New  York  Central  and  in  part  to  an 
enlarged  Pennsylvania,  the  two  resulting  consolida¬ 
tions,  although  constituting  only  2  out  of  19  proposed 
systems,  would  together  constitute  27  per  cent  of  the 
railroad  gross  revenues  of  the  entire  country.  In  the 
opinion  of  this  Committee  this  situation  would  he  un¬ 
fortunate  for  the  country  as  a  whole  and  disastrous  for 
New  England.  Such  a  Pennsylvania  System  would 
have  lines  of  railway  and  exercise  important  control 
over  transportation  in  fourteen  states,  viz.,  Massachu¬ 
setts,  Rhode  Island,  Connecticut,  New  York,  New  Jer¬ 
sey,  Delaware,  Maryland,  District  of  Columbia,  Penn¬ 
sylvania,  Ohio,  Indiana,  Michigan,  Illinois  and  Mis¬ 
souri;  the  New  York  Central  similarly  in  thirteen 
states,  viz.,  Maine,  New  Hampshire,  Vermont,  Massa¬ 
chusetts,  New  York,  Pennsylvania,  New  Jersey,  Prov¬ 
ince  of  Ontario,  Michigan,  Ohio,  Indiana,  Illinois,  and 
Missouri. 

Not  many  students,  either  of  business  or  government 
administration,  would  expect  as  satisfactory  results  for 
the  public  from  the  centralized  management  in  Phila¬ 
delphia  of  a  railroad  extending  from  Boston  to  Wash¬ 
ington  in  the  South,  St.  Louis  and  Chicago  in  the  West, 


206 


and  Mackinaw  City,  Michigan,  in  the  North,  or  from 
the  management  in  New  York  of  a  railroad  extending 
from  Yanceboro,  Maine,  to  Pittsburgh,  Southern  West 
Virginia  and  to  Cairo,  Illinois,  at  the  South,  St.  Louis 
and  Chicago  at  the  West,  to  the  tip  of  the  Michigan  pen¬ 
insula  at  Mackinaw  City,  and  Canada  and  the  St.  Law¬ 
rence  Liver  at  the  North,  as  from  the  management  of 
a  consolidated  New  England  System,  with  practically 
its  entire  mileage  within  New  England,  and  with  its 
policy  shaped  by  New  England  men. 

Our  railroads  and  the  interests  of  the  local  population 
at  present  served  by  them  would  be  hopelessly  lost  in 
such  over-extended  and  unwieldy  transportation  agen¬ 
cies.  In  transportation  as  in  government  it  is  always 
possible,  and  there  is  always  danger,  that  a  centralized 
authority  will  be  developed  attempting  to  exercise  its 
jurisdiction  over  so  vast  an  area,  and  upon  such  a 
numerous  population  as  inevitably  to  lead  to  ignorance 
of  and  disregard  for  the  wishes,  welfare  and  interests 
of  individuals.  It  is  important  to  avoid  this  wrong 
tendency  for,  after  all,  the  prosperity,  happiness  and 
contentment  of  any  people  is  only  the  aggregate  pros¬ 
perity,  happiness  and  contentment  of  its  individual 
members. 


207 


Conclusion  of  Committee  as  to  Consolidation 

The  Committee  is  satisfied  that  such  a  compact  rail¬ 
road  system  as  that  represented  in  the  proposed  New 
England  consolidation  would  involve  a  minimum  of  the 
evils  and,  with  conditions  as  they  are  in  New  England, 
would  produce  a  maximum  of  the  benefits  possible  to 
result  from  consolidation  under  the  provisions  of  the 
Transportation  Act  of  1920. 

But  the  Committee  believes  that  such  consolidation 
is  neither  advisable  nor  equitably  possible  until  each  of 
the  two  major  New  England  systems  shall  first  have 
been  rehabilitated  and  shall  have  shown  the  financial 
and  operating  results  it  is  capable  of  producing  under 
normal  conditions  and  with  restored  credit. 


208 


REHABILITATION  BY  COOPERATION 

New  Haven  Rehabilitation 

The  immediate  problem  under  our  nose  in  New  Eng¬ 
land  is  not  consolidation.  It  is  the  rehabilitation  of  our 
two  major  systems  so  that  they  can  be  lifted  out  of 
their  present  acute  difficulties  and  give  to  New  England 
industry  and  to  the  New  England  public  the  grade  of 
transportation  service  that  is  vital  if  New  England  is 
to  hold  its  place  against  the  keen  competition  of  other 
districts.  Consolidation  is  not  the  immediate  medicine 
needed  by  New  England.  Rehabilitation  comes  first. 

Turning  first  to  the  New  Haven,  we  briefly  review 
the  financial  conditions  of  the  road  as  it  has  already 
been  described  in  this  report.  Since  1915  it  has  sustained 
and  written  off  losses  of  $40,546,840  on  its  outside  in¬ 
vestments.  It  is  carrying  on  its  books  at  cost  price 
many  outside  investments  which  are  of  little  value. 
The  shrinkage  is  very  large,  including,  as  it  does,  such 
items  as  New  York,  Westchester  &  Boston,  which 
brings  in  no  income  and  costs  the  New  Haven  $864,000 
a  year  in  interest  on  the  guaranteed  bonds,  also  the 
trolley  investments  some  of  which  have  but  a  nominal 
value. 

During  the  past  three  years  the  Income  Accounts 
have  shown  large  deficits  as  follows : 

Deficits  after  Interest  Charges 


1920  .  $4,276,726 

1921  .  13,603,654 

1922  .  5,309,759 


Total  3  years 


$23,190,139 


209 


The  result  of  the  losses  in  outside  investments  and 
deficits  from  operation  is  reflected  in  a  large  balance 
sheet  deficit  as  of  December  31,  1922.  In  1921  the 
company  wrote  up  its  property  investment  account 
$25,685,000  (net),  to  capitalize  improvements  made  be¬ 
tween  1880  and  1915  previously  charged  to  Income, 
Profit  and  Loss  and  Operating  Expenses,  but  after 
allowing  for  the  effect  of  this  write-up  the  Net  Corpor¬ 
ate  Deficit  including  the  $2,581,667  Corporate  Surplus 
of  the  Central  New  England  Railway  is  $22,750,010. 

We  have  discussed  the  results  of  operation  of  the 
first  four  months  of  the  present  year,  which  show  a 
deficit  of  $4,999,483  after  fixed  charges.  The  road  will 
be  fortunate  if  it  does  not  in  the  year  1923  have  as  large 
a  deficit  from  operations  as  in  1922. 

It  is  unnecessary  to  dwell  upon  the  bearing  of  these 
facts  upon  the  road’s  credit.  The  question  of  credit 
is  vital.  During  the  next  twelve  years  the  road  has 
maturing  indebtedness  of  $127,824,201  (to  the  Federal 
Government  $88,546,500,  bonds  in  hands  of  public 
$39,277,701)  with  $12,819,505  additional  for  leased 
lines.  These  maturities  begin  with  $5,587,348  *  in  1924 
followed  by  $24,431,251  of  the  European  loan  of  1907 
due  April,  1925,  less  than  two  years  away,  which  has 
already  been  once  extended  at  the  rate  of  7%.  In 
addition  $11,762,607  *  of  other  indebtedness  comes  due 
during  1925. 

*  Includes  obligations  of  leased  lines  and  subsidiary  trolley  properties. 


210 


In  our  judgment  only  two  alternatives  present  them¬ 
selves  as  methods  of  procedure  in  rehabilitating  the 
New  Haven.  One  is  rehabilitation  through  receiver¬ 
ship.  This  method  would  be  accompanied  not  only  by 
the  heavy  expenses  involved  in  receivership  proceed¬ 
ings,  but  by  a  depressing  effect  upon  all  business  activ¬ 
ity  in  New  England. 

The  other  alternative  is  rehabilitation  by  coopera¬ 
tion,  a  voluntary  reorganization  of  the  company  in 
which  all  New  England  will  give  its  help,  the  public 
through  the  state  governments,  the  stockholders,  the 
bondholders,  and  the  shippers  served  by  the  road — and 
we  believe  the  Federal  Government. 

The  advantages  of  the  method  of  rehabilitation 
through  cooperation  speak  for  themselves.  We  be¬ 
lieve  the  prompt  and  successful  achievement  of  such  a 
venture  would  give  New  England  a  new  impetus. 
New  England  has  shown  courage  and  resourceful¬ 
ness  in  the  past.  We  believe  New  England  is  ready 
to  do  so  again. 

The  Committee  has  worked  out  a  constructive  plan 
for  rehabilitation  which  it  presents  in  detail.  This 
plan  it  should  be  understood  is  offered  as  a  tentative 
suggestion,  but  it  is  the  result  of  careful  study  and 
represents  an  effort  to  put  into  actual  workable  form 
what  would  otherwise  be  a  mere  statement  of  generali¬ 
ties. 

As  a  first  step  in  building  our  plan  of  rehabilitation 
by  cooperation  we  have  endeavored  to  arrive  at  an 
estimate  of  what  the  earnings  of  the  New  Haven  should 
be  in  1925  based  upon  the  conditions  and  assumptions  . 
we  shall  set  forth. 


211 


Estimate  oe  Earnings  in  1925  Under  Normal 

Conditions 

In  our  opinion  the  New  Haven  Railroad,  if  its  opera¬ 
tions  can  be  conducted  with  a  reasonable  and  attainable 
degree  of  efficiency  to  be  arrived  at  in  1925,  should  earn 
in  that  year,  if  average  business  conditions  and  the 
present  general  average  of  rates  prevail,  a  gross  rev¬ 
enue  from  railway  operations  of  about  $143,232,000 
and  a  net  revenue,  before  fixed  charges,  of  about 
$29,155,000.  This  net  revenue  after  deducting  $21,- 
640,000  Tor  fixed  charges  would  leave  a  surplus  of  in¬ 
come  over  all  expenses  and  charges  of  about  $7,515,000. 

We  have  considered  this  estimate  with  great  care 
and  we  believe  it  is  based  upon  a  sound  analysis  of 
all  material  factors,  and  is  thoroughly  conservative. 

We  cannot  compare  to  much  advantage  this  estimate 
with  a  recent  year  because  1922  was  the  year  of  the 
strike  in  the  textile  industry  and  the  coal  strike  which 
affected  coal  traffic  and  distorted  the  cost  of  locomotive 
fuel  and  also  the  year  of  the  shop  strike.  1921  was  a 
year  of  acute  business  depression.  The  several  years 
before  1921  were  affected  by  war  conditions  and  fed¬ 
eral  control.  We  give,  however,  in  the  following  state¬ 
ment  our  estimate  in  comparison  with  the  calendar  year 
1922  and  in  comparison  with  the  overlapping  year  July 
1,  1921,  to  June  30,  1922,  which  does  not  include  the 
shop  strike  period : 


212 


NEW  YORK,  NEW  HAVEN  &  HARTFORD  R.  R.  CO.  (INCLUDING 

CENTRAL  NEW  ENGLAND) 

Comparison  of  Earnings  for  Years  Ending  June  30,  1922,  and  December  31,  1922,  with 
Estimate  of  Earnings  in  1925  under  Normal  Conditions 


Year  Ending 
June  30,  1922 

Per  Cent 
Expenses 
to 

Revenues 

Year  Ending 
Dec.  31,  1922 

Per  Cent 
Expenses 
to 

Revenues 

Estimate 

op 

Earnings 
in  1925 

Per  Cent 
Expenses 
to 

Revenues 

REVENUE 

Freight . 

$64,227,084 

$66,157,967 

$73,814,000 

Passenger . 

49,595,777 

49,443,460 

53,889,000 

Mail  .“ . 

1,542,451 

1,523,311 

1,660,000 

Express . 

4,029,777 

4,961,182 

5,408,000 

Other  Passenger  Transportation . 

1,546,872 

1,612,707 

1,758,000 

Other  Freight  Transportation . 

772,550 

832,650 

933,000 

Total  Transportation  Revenue . 

$121,714,511 

$124,531,277 

$137,462,000 

Dining  Buffet  and  Other  Incidental  Passenger 

Revenue  . 

1,904,966 

1,985,289 

2,164,000 

Demurrage  and  Other  Incidental  Freight 

Revenue  . 

713,362 

709,044 

794,000 

Other  Incidental  Revenues . 

1,617,507 

1,793,746 

1,794,000 

Joint  Facility  Revenues . 

1,031,987 

1,018,036 

1,018,000 

•  Total  Railway  Operating  Revenue  .... 

$126,982,333 

$130,037,392 

$143,232,000 

EXPENSES 

Maintenance  of  Way  and  Structures  .... 

$18,558,127 

14.61 

$17,893,602 

13.76 

$18,500,000 

12.92 

Maintenance  of  Equipment . 

25,854,031 

20.36 

27,495,877 

21.14 

26,096,000 

18.2 2 

Transportation . 

51,785,614 

40.78 

53,618,342 

41.24 

56,177,000 

39.22 

Other  Expenses . 

6,406,980 

5.05 

6,198,271 

4.77 

6,399,000 

4.46 

Total  Railway  Operating  Expenses  .  .  . 

$102,604,752 

80.80 

$105,206,092 

80.91 

$107,172,000 

74.82 

Net  Revenue  from  Railway  Operation  .  . 

24,377,581 

24,831,300 

36,060,000 

TAXES  AND  RENTS 

Taxes . 

$4,678,809 

$4,874,486 

$5,000,000 

Hire  of  Freight  Cars  (Net) . 

1,812,618 

2,880,235 

1,550,000 

Other  Equipment  Rents  (Net) . 

Cr  .-178,824- 

108,588 

125,000 

Joint  Facility  Rent  (Net) . 

4,274,008 

4,111,110 

4,200,000 

Uncollectible  Railway  Revenues . 

39,792 

30,841 

30,000 

Total  Taxes  and  Rents . 

$10, 626,903 

$12,005,260 

$10,905,000 

Net  Railway  Operating  Income . 

13,750,678 

12,826,040 

25,155,000 

Non-Operating  Income  (Net) . 

3, 196,275 A 

2,650,122  A 

4,000,000 

Total  Net  Inc.  Available  for  Fixed  Charges 

$16,946,953 

$15,476,162 

$29,155,000 

FIXED  CHARGES 

Rent  for  Leased  Roads  (Net) . 

$2,843,561  A 

$2,843,621  A 

$2,844,000 

Interest . 

15,982,022 

16,408,228 

17,128,000 

Other  Deductions . 

1,556,834 

1,667,882 

1,668,000 

Total  Fixed  Charges . 

$20,382,417 

$20,919,731 

$21,640,000 

Per  Cent  Net  Income  to  Fixed  Charges  .  . 

83.14 

73.98 

134.73 

Adjustments  for  Period  of  Federal  Control  . 

Ct.-993,570 

Dr.  26,008 

Net  Income . 

Det.-2,W,894 

Def  .-5,469,577 

7,515,000 

Note  A  —  This  is  a  Net  Item  and  excludes  certain  inter-company  and  leased  line  accounts.  The  exclusion  of  these  items  from 
both  “Non-Operating  Income”  and  “Rents  for  Leased  Roads”  makes  a  clearer  and  more  logical  statement  in  the  opinio0 
of  the  Committee.  This  accounts  for  the  difference  between  these  items  for  the  year  ending  December  31,  1922,  on  thu 
statement  and  on  the  Condensed  Income  Account,  1908  to  1922  (Exhibit  A,  opposite  page  65). 


213 


Basis  of  Estimate 

The  figures  supporting  this  estimated  surplus  of 
$7,515,000  after  fixed  charges  are  based  upon : 

An  estimated  increase  in  freight  traffic  over  1922  at 
the  rate  of  4%  a  year. 

This  means  a  ton-mile  movement  of  about  3,383,000,- 
000  compared  with  3,020,000,000  ton  miles  in  1922,  when 
the  volume  of  freight  handled  by  the  New  Haven 
reached  about  the  lowest  point  during  the  last  six  years. 
The  actual  volume  of  freight  traffic  in  the  four  months 
ending  April  30, 1923,  increased  8%  over  the  same  four 
months  of  1922,  despite  the  embargoes  of  1923. 

We  believe  also  that  there  will  be  a  gain  in  passenger 
traffic  which  we  have  estimated  at  3%  a  year,  and  we 
have  estimated  that  mail,  express  and  other  railway 
operating  revenues  will  increase  in  similar  propor¬ 
tions.  The  volume  of  passenger  traffic  in  the  first  four 
months  of  1923  has  already  shown  a  considerable  in¬ 
crease  (about  5%)  over  the  same  period  of  1922. 

We  are  assuming  in  our  estimate  of  gross  revenue 
that  the  average  rates  for  freight,  passenger,  mail  and 
express  will  remain  at  about  the  present  level. 

We  are  also  assuming  that  the  embargo  policy  which 
during  1922  seriously  depleted  the  net  earnings  will  be 
revised  and  put  on  a  different  basis;  also  that  the 
nimble  freight  car  will  predominate  on  the  New  Haven 
system  and  bring  the  average  freight  car  miles  up  to 
seventeen  miles  per  day.  The  president  of  the  road  has 
advised  this  committee  that  it  can  be  brought  to  nine¬ 
teen  miles  per  day. 


214 


We  quote  from  his  testimony: 

“  But  if  we  assume  the  approximation  of  nineteen 
miles  which  you  could  reach,  although  I  am  sure 
it  is  going  to  go  above  twenty  when  we  get  normal, 
in  comparison  with  the  average  in  prior  years  of 
fifteen,  it  means  that  heavy  traffic  will  do  the 
business  of  the  New  Haven  road  with  something 
like  6,000  to  8,000  less  cars,  because  of  more  rapid 
movement  than  would  have  been  possible  on  the 
basis  of  selecting  the  lower  number  of  miles  per 
day.  ’ 9  (  Committee ’s  Record  p.  2571. ) 

In  our  estimate  of  “  normal 99  operating  expenses 
we  have  assumed  there  will  be  no  important  changes 
in  the  present  scale  of  wages. 

Expenses  for  Maintenance  of  Way  &  Structures  we 
estimate  at  $18,500,000,  which  is  $606,000  greater  than 
in  the  year  ending  December  31, 1922,  and  substantially 
the  same  as  for  the  year  ending  June  30,  1922,  when 
these  expenses  appear  to  have  been  about  normal.  It 
must  be  borne  in  mind  that  repairs  of  road  and  struc¬ 
tures  need  not  necessarily  increase  materially  on  ac¬ 
count  of  a  moderate  increase  in  train  movement. 

In  our  estimate  of  expenses  for  Maintenance  of 
Equipment  we  are  assuming  that  the  cost  of  locomotive 
repairs  can  be  brought  down  well  below  the  average 
for  1922,  when  it  was  thrown  quite  out  of  line  by  the 
shop  strike,  and  that  the  condition  of  equipment  and 
the  number  of  “  bad  order  99  freight  cars  will  have 
been  brought  by  1925  to  normal,  so  that  7,951  bad 
order  cars  will  be  restored  to  service  and  earning 
money. 

Our  estimate  of  Transportation  Expenses  assumes 


215 


that  the  cost  of  coal  will  be  substantially  the  same  as  for 
the  year  ending  June  30,  1922 ;  that  winter  conditions 
will  be  normal,  and  that  the  traffic  will  be  handled  with 
reasonable,  attainable  efficiency.  We  have  estimated 
that  the  Transportation  Expenses  incident  to  the  move¬ 
ment  of  freight  traffic  will  be  increased  over  those  of  the 
year  ending  June  30, 1922,  in  direct  proportions  to  our 
estimated  increases  in  traffic,  and  that  other  Transpor¬ 
tation  Expenses  will  increase  over  1922  to  the  extent  of 
75  per  cent  of  our  estimated  increases  in  traffic.  We 
have  reduced  certain  items  of  cost,  but  only  where  they 
were  clearly  abnormally  large  in  1922. 

Our  estimate  of  net  cost  for  rentals  of  freight  cars 
has  been  based  upon  careful  study,  due  allowance  hav¬ 
ing  been  made  for  the  additional  “  foreign  ”  cars  re¬ 
quired  for  the  additional  traffic. 

We  have  estimated  that  fixed  charges  will  increase 
about  $720,000  over  1922,  representing  interest  on  an 
estimated  annual  expenditure  of  $4,000,000  for  addi¬ 
tions  and  improvements  to  the  property  and  equip¬ 
ment  during  3  years. 

We  have  estimated  that  the  net  “  Non-operating  In¬ 
come  ”  would  increase  from  $2,650,000  in  1922  to 
about  $4,000,000  in  1925.  This  estimate  is  based  upon 
the  fact  that  no  dividends  were  paid  in  1922  upon  the 
capital  stock  of  the  New  England  Steamship  Co. 
(which  owns  and  operates  the  Fall  Kiver  line  and  other 
Long  Island  Sound  steamboat  lines)  or  on  the  capital 
stock  of  the  New  York,  Ontario  &  Western.  The  entire 
capital  stock  of  the  New  England  Steamship  Co.  and  a 
majority  of  the  stock  of  the  New  York,  Ontario  & 
Western  are  owned  by  the  New  Haven.  The  New 


216 


England  Steamship  Co.,  in  the  12  months  ending  April 
30,  1922,  earned  about  $850,000  over  its  fixed  charges. 
The  New  York,  Ontario  &  Western,  during  years  when 
coal  traffic  was  normal,  has  been  able  to  pay  2  per  cent 
dividends  bringing  in  about  $583,000  annually  to  the 
New  Haven.  In  our  estimate  of  $4,000,000  we  have 
taken  into  account  probable  dividends  from  the  above 
two  sources,  hut  have  estimated  that  no  revenue  will 
be  received  by  1925  from  stocks  of  the  Boston  &  Maine 
or  Rutland  railroads,  the  investment  in  New  York, 
Westchester  &  Boston,  or  from  stocks  of  the  various 
street  railway  properties.  The  Connecticut  Company 
is  showing  a  substantial  surplus  over  its  fixed  charges, 
but  its  surplus  income  for  several  years  to  come 
will  probably  be  needed  to  take  care  of  its  own  capital 
requirements  for  additions  and  improvements  and  to 
pay  oft  its  floating  debt. 


Improved  Operation  Will  Build  up  Traffic 

A  good,  sound,  thrifty  management  whether  in  rail¬ 
roading  or  manufacturing  generally  secures  not  a  small 
part  of  its  net  results  from  the  many  little  leaks 
stopped  and  the  many  little  increases  in  efficiency 
gained.  We  have  taken  this  into  consideration  but 
to  a  very  minor  extent  in  our  calculations. 

Our  estimate  of  increase  in  freight  traffic  seems  con¬ 
servative  partly  because  the  New  Haven  has  not  been 
able  to  build  up  its  freight  business,  during  recent 
months  at  least,  to  •  what  might  have  been  possible, 
owing  to  the  poor  condition  of  its  motive  power  and 
other  operating  conditions.  The  traffic  department 


217 


which  is  the  selling  department  has  had  little  to  sell  in 
the  way  of  surplus  transportation  and  frequently 
nothing  to  sell  because  the  operating  department  has 
been  unable  to  take  on  additional  business,  or  indeed 
to  care  for  all  the  business  pressed  on  the  road  by  ship¬ 
pers.  On  a  strong  road  the  operating  department,  ex¬ 
cept  rarely  at  a  peak  when  all  roads  are  overloaded, 
spends  no  time  limiting  traffic.  On  the  contrary  the 
traffic  department  is  out  soliciting  additional  business 
as  hard  as  it  can  go  and  when  successful  the  operating 
department  cares  for  it  and  undertakes  to  give  service 
satisfactory  to  the  new  shippers  as  a  matter  of  course. 

The  shippers  of  a  great  deal  of  valuable  trainload 
traffic  originating  in  Northern  New  England,  although 
the  New  Haven  has  the  level  route  and  the  shortest  by 
a  hundred  miles,  are  routing  their  cars  over  the  Berk¬ 
shire  Hills  and  then  down  the  Hudson  River  to  New 
York  and  beyond,  because  they  find  that  this  circuitous 
up  and  down  hill  route  gives  the  better  service.  If 
operating  conditions  on  the  New  Haven  improve,  the 
traffic  department  cannot  be  expected  to  go  out  and 
bring  this  business  back  in  a  month  or  two,  but  continued 
good  service  and  ability  to  handle  it  ought  gradually 
to  bring  back  at  least  a  large  part  of  it  to  the  natural 
route  possessed  by  the  New  Haven. 


Cooperation  of  Employees 

The  employees  of  this  road  are  New  England  men. 
We  firmly  believe  that  under  the  right  circumstances 
they  will  gladly  lend  a  hand  to  make  this  railroad  one 
of  the  best  conducted  roads  in  the  country.  It  is  but 


218 


a  small  percentage  of  men  wlio  are  solely  interested  in 
getting.  Most  of  us  want  to  give  as  well  as  get,  if  our 
relations  are  on  a  friendly  and  sympathetic  basis. 

We  feel  sure  that  the  New  Haven  Railroad  can  at¬ 
tain  a  standard  of  which  we  shall  all  be  proud.  It ’s 
a  better  game — more  interesting.  Let  us  all  make 
up  our  minds  to  help,  —  shippers,  travelers,  officers, 
employees,  public  authorities,  everybody.  Putting 
in  a  stream  of  alibis  why  we  are  not  what  we 
want  to  be  here  in  New  England  is  dull  stuff.  It  isn’t 
half  as  interesting  as  getting  all  together  as  our  fathers 
did  at  the  opening  of  the  railroad  era  and  being  what 
we  would  like  to  be. 

Credit 

It  may  be  said  if  on  a  conservative  estimate  we  figure 
a  surplus  of  $7,515,000,  that  will  keep  us  out  of  the 
sheriff’s  hands,  and  is  it  not  enough  %  It  is  not  enough. 
In  the  first  place  this  thirty-five  per  cent  margin  above 
fixed  charges  is  an  average  figure.  We  are  bound  to 
have  normal  years,  extra  good  years  and  extra  bad 
years.  Every  time  we  have  an  extra  bad  year  the  road 
might  not  earn  its  fixed  charges.  If  every  few  years 
a  year  came  along  when  the  road  did  not  earn  its  fixed 
charges  the  road  would  have  only  a  third-  or  fourth- 
class  credit.  If  we  want  to  make  the  New  Haven  a  first- 
class  road  we  must  have  a  first-class  credit  and  get  it 
now.  It  is  a  tool  we  need  to  work  with. 

If  at  times  the  road  cannot  sell  its  securities  at  all 
and  the  rest  of  the  time  additional  capital  can  be  at¬ 
tracted  only  at  excessive  rates  we  can  never  get  our 
feet  on  dry  land. 


219 


To  get  first-class  credit  we  must  not  only  earn  our 
fixed  charges  every  year,  but  we  must  earn  them  by  a 
good  margin.  When  people  find  it  interesting  to  dis¬ 
cuss  whether  a  railroad  is  going  to  earn  its  fixed 
charges,  you  may  be  sure  the  road’s  credit  is  already 
damaged.  Good  credit  involves  keeping  so  far  away 
from  the  region  of  doubt  that  no  one  cares  to  hold  a 
conversation  on  the  subject. 

Where  is  this  line?  By  common  consent  and  based 
upon  many  years’  experience  the  rule  for  first-class 
railroad  credit  is  that  net  earnings  must  average  close 
to  twice  the  fixed  charges.  The  promise  to  pay  of  such 
a  road  will  always  be  considered  prime  and  will  bring 
a  high  price.  Come  down  to  one  and  a  half  or  one  and 
a  third  and  you  have  “  boarding  house  ”  butter,  come 
down  to  one  and  a  quarter  or  one  and  a  fifth  and  you  have 
“  worked  over  ”  butter.  It  is  perhaps  true  that  a  road 
which  has  shown  over  a  long  period  of  years  ability 
to  earn  once  and  a  half  times  its  fixed  charges  will 
gradually  acquire  confidence  and  a  good  credit,  but 
certainly  a  road  that  is  trying  to  rebuild  its  credit 
within  a  reasonable  period  of  time  must  show  a  bigger 
margin  than  once  and  a  half. 

How  are  we  going  to  establish  a  better  relation  be¬ 
tween  fixed  charges  and  net  earnings?  It  is  no  fault 
of  the  bondholders  that  the  road  has  lost  a  lot  of  its 
capital,  and  the  savings  banks  are  the  largest  bond¬ 
holders.  It  is  clear,  however,  we  must  ask  the  bond¬ 
holders,  savings  banks  and  all,  to  waive  some  of  their 
claims. 

It  may  be  asked  why  does  this  Committee  concern  it¬ 
self  with  the  fixed  charges  of  the  New  Haven  or  with 


220 


what  should  be  done  in  regard  to  them.  It  is  because  to 
take  no  cognizance  of  the  fixed  charges  of  the  New 
Haven  and  to  present  no  plan  for  dealing  with  them 
would  leave  the  conclusions  of  the  Committee  dangling 
in  the  air  with  no  solution  of  our  problem. 


Readjustment  of  New  Haven  Capitalization 

We  have  reached  the  conclusion  that  it  is  fair  and 
necessary  under  all  the  circumstances  to  ask  the  bond¬ 
holders  to  cut  down  their  bonds  $76,000,000.  All  the 
bondholders  cannot  be  treated  alike  as  some  of 
them  hold  bonds  which  are  far  from  the  firing  line 
even  under  present  circumstances — bonds,  for  ex¬ 
ample,  like  the  Harlem  River  &  Port  Chester  4s  of 
1954.  So  it  is  not  proposed  to  disturb  bonds  of  this 
character.  But  about  $133,000,000  of  bonds  not  so  well 
secured  we  suggest  should  be  cut  forty  per  cent.  About 
$25,000,000  bonds  which  are  still  less  well  secured  we 
suggest  should  be  cut  fifty  per  cent,  and  about 
$17,000,000  other  debenture  bonds  should  be  cut  about 
sixty  per  cent. 

We  suggest  that  the  holders  of  the  bonds  that  are  cut 
should  be  asked  to  take  a  new  5  per  cent  first  preferred 
stock  cumulative  from  January  1,  1927.  This  stock 
would  be  issued  against  3y2  per  cent,  4  per  cent  and 
5  per  cent  bonds  to  an  amount  equal  to  the  amount 
that  the  bonds  are  scaled  down.  Against  6  per  cent 
and  7  per  cent  bonds  it  would  be  issued  to  an  amount 
equal  to  120  per  cent  of  the  amount  that  the  bonds  are 
cut  down.  This  as  set  forth  in  detail  in  Appendix  T 
would  cut  the  indebtedness  of  the  New  Haven  Railroad 


221 

t. 

by  $76,006,640  and  reduce  the  annual  fixed  charges  by 
$3,641,498. 

This  would  reduce  fixed  charges  of  the  road  from 
$21,640,000  to  $18,000,000  as  compared  with  estimated 
earnings  of  $29,155,000,  a  ratio  between  interest  charges 
and  average  net  earnings  of  one  and  six  tenths,  but  this 
as  we  have  pointed  out  does  not  go  far  enough  to  estab¬ 
lish  a  first-class  credit. 

Next,  therefore,  we  suggest  that  the  present  stock¬ 
holders  should  be  asked  to  come  forward  and  undertake 
to  raise  $15,000,000  of  cash  by  buying  or  arranging  for 
the  purchase  by  others  from  the  company  of  enough 
common  stock  at  or  about  market  prices  to  bring  in 
the  $15,000,000. 

Under  our  state  laws  today  this  stock  cannot  be  sold 
by  the  company  at  less  than  $100  per  share.  It  is  true 
when  this  stock  was  originally  sold  the  purchasers  paid 
at  least  $100  per  share  for  it  and  a  great  many  paid 
much  more.  But  to  imagine  this  new  stock  can  now  be 
sold  for  $100  per  share  would  be  like  expecting  a  canvas- 
back  duck  to  step  out  of  a  hen’s  egg.  We  recommend, 
therefore,  that  the  legislatures  of  Connecticut,  Rhode 
Island,  and  Massachusetts  recognize  today’s  reality  by 
removing  the  old  par  value  for  the  New  Haven  stock 
and  permitting  it  to  be  sold  for  its  market  value. 

It  maybe  asked  why  not  stick  to  the  par  value  stamped 
on  the  common  stock  certificate  and  sell  a  preferred.  If 
the  preferred  is  put  on  equal  footing  with  the  preferred 
stock  given  the  bondholders,  it  is  diluting  for  the  benefit 
of  the  common  stockholders  a  stock  created  to  compen¬ 
sate  for  the  waiver  of  the  superior  right  of  the  bond¬ 
holders  and  does  not  seem  fair.  If  it  is  made  a  second 


222 


preferred  stock  it  seems  to  us  it  would  be  very  difficult 
to  sell.  But  if  the  road  is  to  be  rehabilitated,  to  be  set 
up  in  solid  financial  condition  and  given  a  new  orienta¬ 
tion,  it  is  believed  the  common  stock  would  appeal  to  a 
large  reservoir  of  capital  which  would  be  glad  to  come 
forward  to  subscribe  for  it. 

The  sale  of  this  new  stock  is  especially  fair  because 
if  a  stockholder  wants  to  preserve  his  same  proportion, 
he  can  take  his  share  of  the  new  stock,  but  if  he  is  un¬ 
able  to  do  this  he  has  still  by  assenting  to  the  plan  made 
an  indirect  contribution  and  yet  retains  a  stock  interest 
which  under  a  receivership  and  an  assessment  he  would 
lose  altogether  if  he  did  not  pay  his  assessment. 

Atchison  Reorganization  of  1893 

The  rehabilitation  of  the  Atchison  Railroad  Company 
in  1893  proved  to  be  one  of  the  soundest  and  most  suc¬ 
cessful  reorganizations  ever  undertaken  in  this  country. 
In  that  case  the  common  stockholders  came  forward 
and  did  their  part  by  contributing  ten  dollars  cash  per 
share. 

It  is  to  be  noted  that  the  Atchison  common  stock  sold 
at  a  good  deal  lower  price  than  has  been  recorded  for 
the  common  stock  of  either  the  Boston  &  Maine  or  the 
New  Haven. 

As  the  Atchison  was  in  the  hands  of  a  receiver  it  was 
possible  to  wipe  out  any  common  stock  refusing  to  con¬ 
tribute  and  so  unanimous  consent  to  the  contribution 
was  obtained.  This  cannot  be  done  here. 

Even  after  the  reorganization  and  the  paying  in  of 
the  additional  ten  dollars  per  share  the  common  stock 


223 


of  the  Atchison  still  sold  for  a  time  at  less  than  today’s 
prices  of  the  common  stock  of  either  of  our  two  rail¬ 
roads,  and  for  less  than  five  dollars  above  the  new  ten 
dollars  paid  in.  But  the  reorganization  was  sound, 
first-class  management  was  given  the  property,  and 
today  its  credit  stands  as  high  as  that  of  any  railroad 
in  the  country. 

We  recommend  that  savings  banks  and  other  institu¬ 
tions  and  fiduciaries  be  given  any  necessary  power  to 
participate  in  the  rehabilitation  of  the  New  Haven 
under  the  plan  suggested  by  the  Committee,  and  to 
hold  for  five  years  after  the  period  of  control  by  the 
trustees  their  present  securities  and  any  new  securities 
they  acquire  by  participating. 

This  $15,000,000  to  be  secured  by  the  sale  of  common 
stock  could  be  used  to  buy  in  outstanding  bonds  and 
so  further  reduce  capital  or  it  more  probably  should  be 
held  in  hand  for  future  capital  needs.  In  either  case 
it  will  reduce  charges  or  give  the  road  some  more  cars 
or  locomotives  or  other  property  to  help  earn  the  fixed 
charges.  For  the  purpose  of  our  calculation,  we  will 
consider  it  is  applied  to  the  reduction  of  charges  by  the 
purchase  and  cancellation  of  bonds.  It  would,  we  think, 
buy  in  at  least  enough  outstanding  bonds  to  reduce 
fixed  charges  seven  hundred  and  fifty  thousand  dollars 
so  we  will  deduct  this  sum  from  our  last  figure  for 
fixed  charges  —  $18,000,000  —  and  this  brings  us  to 
fixed  charges  of  $17,250,000  compared  with  net  earn¬ 
ings  of  $29,155,000. 


224 


Cooperation  of  the  States 

This,  however,  still  does  not  go  far  enough.  It  may 
be  asked  why  if  this  does  not  go  far  enough  should  we 
not  “  hit  ”  the  bondholders  and  stockholders  harder  for 
as  much  more  as  we  need.  The  answer  is  that  neither  we 
nor  anybody  else,  not  even  the  states,  have  the  power 
to  “hit”  either  the  bondholders  or  the  stockholders. 
We  are  asking  for  the  voluntary  cooperation  of  the 
bondholders  and  stockholders  in  rehabilitating  for  the 
public  good  this  property  and  setting  it  on  its  feet. 

What,  therefore,  can  we  propose  in  order  to  get  the 
New  Haven  to  the  point  where  it  can  be  set  up  with  the 
first-class  credit  that  seems  essential  and  what  is  to 
be  the  incentive  to  these  bondholders  and  these  stock¬ 
holders  to  play  their  part  ? 

Here  we  think  the  states  can  well  cooperate. 

We  will  say  first  that  if  any  state  help  is  to  be  given 
we  recommend  that  the  control  and  management  of 
the  Company  be  vested  in  trustees  to  be  appointed  to 
serve  ten  years  by  the  several  states,  two  by  Connecti¬ 
cut,  one  by  Rhode  Island  and  two  by  Massachusetts. 

We  do  this  chiefly  because  if  the  states  are  to  lend 
their  credit  then  we  think  they  should  take  control. 
We  do  not  believe  in  a  divided  responsibility,  part  state 
trustees  and  part  representatives  of  the  stockholders. 
If  this  were  done  the  responsibility  would  be  neither 
here  nor  there.  This  board  would  be  comprised  of 
human  men  who  could  hardly  be  blamed  for  saying, 
and  honestly  believing,  too,  that  if  each  side  during 
a  series  of  years  had  voted  differently  on  a  series  of 
questions  something  different  would  have  taken  place 


225 


from  what  actually  happened.  W e  believe  that  the  best 
policy  will  be  all  state  trustees  sitting  in  the  limelight 
and  one  hundred  per  cent  responsible  to  the  states  and 
to  the  public  for  their  acts  and  the  results.  The  trus¬ 
tees  should  be  paid  reasonable  compensation;  none  of 
them  should  be  executive  officers  but  they  should  be 
responsible  for  the  selection  of  the  executive  officers 
and  their  continuance  in  office  and  therefore  at  all  times 
for  the  quality  of  the  management  and  the  policies  of 
the  company. 

In  our  opinion  state  aid  should  be  extended  by  each 
of  the  three  states  of  Connecticut,  Rhode  Island,  and 
Massachusetts  undertaking  to  return  to  the  road  such 
portion  of  the  taxes  paid  by  the  New  Haven  in  any 
given  year  for  state  and  local  taxes  within  the  state  as 
may  be  required  to  meet  any  failure  of  net  earnings  to 
cover  fixed  charges  for  that  year.  We  do  not  mean  that 
the  sums  paid  in  local  taxes  should  be  returned  to  the 
railroad  by  the  cities  and  towns  but  that  the  states 
should  undertake  the  return  of  the  tax  money  or  such 
portion  thereof  as  may  be  needed  to  restore  a  deficit  in 
fixed  charges. 

The  sum  paid  by  the  New  Haven  in  taxes  in  these 
three  states  totalled  for  1922  — $3,569,934  divided  as 
follows :  Connecticut  $1,890,239,  Rhode  Island  $558,134, 
Massachusetts  $1,121,561. 

This  would  make  the  total  liability  of  Connecticut 
under  such  a  guaranty  applied  to  the  year  1924, 
$1,890,239,  plus  any  increase  in  state  or  local  Connecti¬ 
cut  taxes  levied  during  1924  above  the  $1,890,239  col¬ 
lected  for  the  year  1922.  In  like  manner  and  to  the 
extent  of  the  sums  respectively  levied  in  Rhode  Island 


226 


and  Massachusetts  would  the  guaranty  of  these  two 
states  apply.  It  seems  to  us  this  is  a  fair  and  sound 
method  of  distributing  the  burden  between  these  three 
states.  If  the  taxes  are  relatively  too  high  in  one  of 
these  states  it  will  pay  relatively  perhaps  more,  but 
why  should  it  not  if  it  is  undertaking  to  collect  a  higher 
tax  rate  from  the  railroad  in  the  majority  of  years 
when  the  guaranty,  in  our  judgment,  will  cost  nothing. 
This  guaranty  should  last  as  long  as  the  control  through 
these  trustees  continues. 

We  will  now  suppose  a  year  so  bad  that  the  full 
guaranty  of  the  states  of  $3,569,934  is  called  for.  In 
order  to  reach  the  point  where  the  states  could  be  called 
upon  at  all,  the  net  earnings  of  the  road  would  have  to 
drop,  after  the  bondholders  and  stockholders  had  done 
their  parts  as  above  outlined,  from  our  estimate  of 
$29,155,000  down  to  $17,250,000.  We  think  there  is 
little  likelihood  of  the  earnings  dropping  to  this  figure 
of  $17,250,000  unless  in  some  quite  abnormal  year,  and 
still  less  down  to  the  lower  figure  of  $13,680,000  which 
must  be  the  case  before  the  states  could  be  called  upon 
for  their  full  guaranty.  Indeed,  if  this  road  has 
$75,000,000  of  its  bonds  cancelled  and  $15,000,000  fresh 
cash  put  in  and  operations  are  brought  by  the  state 
trustees  up  to  the  operating  results  which  we  believe 
are  attainable  within  a  few  years,  then  thereafter  at 
least  it  is  improbable  that  the  states  will  be  called  on 
for  any  help  under  their  guaranty. 

It  is  clear  that  for  a  period  while  the  road  is  being 
re-established,  we  suggest  three  years,  no  common 
dividends  should  be  declared  and  thereafter  during 
the  last  seven  years  of  control  by  the  trustees  not 


227 


in  excess  of  half  the  earnings  of  such  years  ordinarily 
applicable  to  dividends  on  the  common  stock.  The 
preferred  stock  which  represents  the  surrender  of 
bonds  should  be  subject  to  no  restrictions  on  the  decla 
ration  of  its  stipulated  5  per  cent  dividends  if  earned. 

We  also  suggest  that  shippers  should  be  asked  to  help 
for  a  time  by  reducing  the  present  two  days  of  free  time 
for  loading  or  unloading  to  one  day  —  the  second  day 
to  have  a  moderate  demurrage  charge  of  say  two  dollars. 

The  question  whether  bonds  issued  by  the  state 
trustees  during  their  control  should  receive  a  state 
guaranty  of  principal  and  interest  is  a  closer  question 
but  we  are  of  opinion  that  if  the  state  trustees  decide 
to  issue  bonds  they  should  carry  a  state  guaranty  as  to 
principal  and  interest.  All  the  people  of  these  states 
are  vitally  interested  in  making  this  property  serve 
them  effectively  at  the  least  possible  cost,  and  for  the 
states  to  stand  behind  the  road  to  the  extent  of  the 
guaranty  we  have  proposed  and  not  to  assist  in  enabling 
the  company  to  raise  at  the  lowest  possible  cost  the  new 
capital  needed  to  perform  the  service  which  the  people 
of  these  states  require  seems  faint-hearted  and  on  the 
whole  an  undesirable  stopping  point.  The  liability  of  the 
states  on  this  guaranty  would  be  pro-rated  among  them 
on  the  basis  of  the  taxes  paid  by  the  road  in  the  several 
states  during  the  year  preceding  the  issue  of  the  bonds. 
If  this  is  done  it  may  be  found  a  better  method  for  the 
states  to  issue  their  own  bonds  and  with  the  proceeds 
buy  a  like  amount  of  bonds  of  the  company  of  the  same 
maturity  and  interest  rate.  In  this  way  the  money  will 
be  obtained  at  a  less  rate  of  interest  and  the  liability  of 
the  states  be  correspondingly  smaller.  The  amount  to 


228 


be  financed  in  this  way  on  state  credit  could  if  desired 
be  limited  to  the  amount  of  bonds  now  outstanding 
which,  after  the  readjustment  we  propose,  will  mature 
during  the  period  of  control  by  the  trustees,  plus,  say, 
$4,000,000  a  year  for  additions  and  improvements. 

Cooperation"  of  Federal  Government 

If  the  states  are  thus  to  cooperate  in  setting  this 
road  on  its  feet  to  enable  it  to  function  properly  it 
seems  clear  that  it  is  fair  to  ask  the  Federal  Govern¬ 
ment  to  reduce  its  present  rate  of  6  per  cent  on  the 
government  war  loan.  This  6  per  cent  under  the  new 
setup  with  the  much  improved  credit  becomes  too  high. 
We  think  that  a  reduction  from  the  present  6  per  cent 
to  4  per  cent  would  be  reasonable  and  fair.  This  would 
still  leave  the  government  rate  of  interest  on  a  basis 
comparable  to  that  recently  fixed  by  our  Federal  Gov¬ 
ernment  for  our  British  war  loan.  We  suggest  that 
the  states  of  Connecticut,  Rhode  Island,  and  Massa¬ 
chusetts  proceed  through  their  representatives  to  put 
forward  this  request  for  the  cooperation  of  the  Fed¬ 
eral  Govermnent,  and  also  request  the  government  to 
fund  its  maturities  into  a  long  time  loan. 

This  cooperation  if  secured  on  the  part  of  the  Fed¬ 
eral  Government  would  reduce  the  company’s  annual 
interest  charges  by  a  sum  equal  to  2  per  cent  on 
$88,500,000,  viz.  $1,770,000. 

Early  maturities  of  New  Haven  debt 

We  give  now  the  indebtedness  maturing  from  1924 
to  1935,  including  the  obligations  of  leased  and  con¬ 
trolled  lines : 


229 


Year 

Due  U.  S. 
Government 

Due 

Others 

Total 

1924  . 

.  .  $100,000 

$5,487,348 

$5,587,348 

1925  . 

.  .  4,390,000 

31,803,858 

36,193,858 

1926  . 

.  .  100,000 

1,190,370 

1,290,370 

1927  . 

.  .  100,000 

2,840,370 

2,940,370 

1928  . 

.  .  100,000 

1,239,370 

1,339,370 

1929  . 

.  .  100,000 

893,370 

993,370 

1930  . 

.  .  60,126,500 

4,296,020 

64,422,520 

1931 . 

.  .  8,160,000 

1,172,900 

9,332,900 

1932  . 

.  .  2,560,000 

1,426,900 

3,986,900 

1933  . 

.  .  4,360,000 

709,900 

5,069,900 

1934  . 

.  .  160,000 

609,900 

769,900 

1935  . 

.  .  8,290,000 

426,900 

8,716,900 

Total  . 

.  .  $88,546,500 

$52,097,206* 

$140,643,706 

*  Includes  $1,186,800  Equipment  Trust  obligations  now  held  by  Director 
General  of  Railroads  which  are  subject  to  resale. 


If  the  maturities  to  the  Federal  Government  are  ex¬ 
tended  as  we  propose,  we  are  left  to  deal  with  $52,000,000 
of  other  maturities  of  which  more  than  half  mature 
in  1925,  consisting  principally  of  the  $24,431,251  de¬ 
bentures  of  the  so-called  European  Loan.  The  re¬ 
mainder  of  the  maturities  for  the  entire  twelve-year 
period  includes  several  million  dollars  of  street  railway 
bonds  assumed  by  the  New  Haven  in  connection  with 
the  acquisition  of  street  railway  properties  which  in 
our  opinion  should  be  refunded  or  paid  off  by  the  street 
railway  properties,  a  smaller  amount  of  trolley  bonds 
upon  which  the  New  Haven  itself  is  not  liable,  and 
almost  the  entire  balance  consists  of  underlying  bonds, 
equipment  trust  obligations,  and  bonds  of  leased  lines, 
all  of  which  the  integrity  of  the  system  requires  be  paid. 
The  holders  of  the  European  Loan,  however,  we  think 
should  receive  30  per  cent  in  cash  and  should  extend 
30  per  cent  of  their  principal  by  taking  in  payment 
therefor  new  6  per  cent  First  and  Refunding  Mort¬ 
gage  bonds  maturing  in  November,  1937.  For  the 


✓ 


230 

remaining  40  per  cent  they  will,  under  the  committee’s 
plan,  receive  preferred  stock. 

Other  Suggestions 

The  New  Haven  Company  has  guaranteed  dividends 
of  $4  a  share  a  year  on  a  total  of  $6,300,000  (63,000 
shares)  of  pref erred  stock  divided  as  follows : 


Boston  Railroad  Holding  Co .  $2,800,000 

New  England  Investment  &  Security  Co.  112,100 
Springfield  Railway  Companies  .  3,387,900 


Total  .  $6,300,000 


An  effort  should  be  made  so  to  deal  with  each  of  these 
issues  as  entirely  to  eliminate  the  guaranties  by  the 
New  Haven  Company. 

The  New  Haven  Company  is  in  effect  the  guarantor 
of  the  rental  ($1,400,000  a  year)  under  the  lease  from 
the  Connecticut  Railway  &  Lighting  Company  of  its 
trolley  and  gas  and  electric  properties.  While  $350,000 
of  this  is  protected  apparently  fully  by  the  rental  on 
the  sublease  of  the  gas  and  electric  properties,  a  balance 
of  $1,050,000  remains  as  *a  direct  charge  against  the 
trolleys  operated  by  the  New  Haven’s  subsidiary,  the 
Connecticut  Company.  The  Connecticut  Company  is 
now  earning  well  in  excess  of  its  charges.  But  not¬ 
withstanding  these  facts,  we  think  an  effort  should  be 
made  to  find  a  basis  on  which  the  entire  guaranty  of 
the  New  Haven  Company  can  be  eliminated. 

In  fact  all  the  trolley  investments  of  the  New  Haven 
should  be  disposed  of  as  soon  as  their  fair  value  can  be 
realized.  The  capital  invested  in  them  will  thus  become 


231 


available  for  the  uses  of  the  New  Haven  Railroad.  In 
an^  such  sale  a  special  effort  should  be  made  to  have 
the  trolley  properties  provide  for  the  payment  in  full 
of  all  mortgage  bonds  secured  upon  them.  Such  a  sale, 
too,  ought  to  afford  an  opportunity  to  procure  a  release 
of  the  New  Haven  from  its  guaranty  of  the  Connecti¬ 
cut  Railway  &  Lighting  rental. 

The  New  Haven  and  the  Pennsylvania  Railroad  are 
joint  guarantors  of  $24,000,000  of  4%  per  cent  bonds 
of  New  York  Connecting  Railroad  Company.  The 
Connecting  Company  is  unable  to  meet  its  interest 
without  receiving  abnormal  allowances  from  the  New 
Haven  and  the  Pennsylvania,  so  that  in  fact  the 
New  Haven  is  being  called  upon  under  this  guaranty. 
As  the  New  Haven’s  liability  here  is  unsecured,  and  so 
is  of  a  lower  grade  than  most  of  the  bonds  and  de¬ 
bentures  which  under  the  plan  are  to  be  converted  in 
part  into  preferred  stock,  an  adjustment  with  the 
Pennsylvania  should  be  sought  under  which  the  New 
Haven’s  responsibility  for  those  bonds  would  take  on, 
in  part  at  least,  the  character  of  a  contingent  charge, 
ranking  with  the  New  Haven’s  preferred  stock,  rather 
than  of  a  fixed  charge. 


State  Cooperation  not  new  in  New  England 
Railroad  History 

It  may  be  urged  that  it  is  a  bold  step  to  utilize  state 
credit  to  help  in  the  restoration  of  this  railroad  to  a 
condition  which  will  enable  it  to  perform  the  service  the 
public  needs  so  badly.  Perhaps  it  is.  But  the  present 
situation  is  a  menace  to  the  welfare  of  the  people  of 


232 


these  three  states.  The  amount  of  the  assistance  pro¬ 
posed,  if  it  should  be  all  required,  is  not  sufficient  to 
cause  any  strain  on  the  credit  of  these  states  and  in  our 
judgment  is  an  essential  part  of  the  plan  needed  to 
provide  these  people  and  their  industries  with  the  serv¬ 
ice  which  it  is  in  the  public  interest  they  should  receive 
with  the  least  possible  delay. 

In  Massachusetts  the  State,  believing  that  the  welfare 
of  its  people  demanded  the  construction  of  the  more 
difficult  and  expensive  lines  west  across  the  state,  ad¬ 
vanced  more  than  three  and  one  half  million  dollars  to 
the  predecessor  of  the  New  York  &  New  England  Rail¬ 
way  to  help  it  to  reach  the  Hudson  River. 

In  1836  the  State  of  Massachusetts  to  aid  the  Western 
Railroad  (later  the  western  half  of  the  Boston  &  Al¬ 
bany)  subscribed  for  one  million  dollars  of  its  capital 
stock  and  subsequently  loaned  the  road  $2,800,000  as 
further  assistance. 

In  the  case  of  the  western  predecessor  of  the  Eitch- 
burg  Railroad  (the  Troy  &  Greenfield  Railroad)  the 
state  advanced  a  total  of  $29,257,913,  principal  and 
interest,  mainly  for  the  construction  of  the  Hoosac 
Tunnel. 

These  grants  of  state  and  local  aid  were  bold  meas¬ 
ures  carried  forward  by  enterprising  men  at  a  time 
when  the  resources  of  the  state  were  almost  insig¬ 
nificant  compared  with  our  resources  of  today.  They 
were  bold  but  they  were  wise.  They  gave  New  Eng¬ 
land  an  immediate  and  tremendous  impetus  which  in¬ 
sured  the  successful  growth  of  our  industries,  our 
population,  and  our  well  being  for  many  decades.  Be¬ 
fore  the  coming  of  the  railroads  the  town  of  Petersham 


233 


in  Worcester  County  is  said  to  have  been  bigger  than 
Worcester.  But  Petersham,  still  untouched  by  a  rail¬ 
road,  has  been  a  charming  hut  dwindling  village  now  for 
nearly  a  hundred  years,  while  the  village  of  Worcester 
has  grown  to  he  a  busy,  prosperous  city  of  180,000 
people. 

On  both  the  Western  Railroad  and  its  successor,  the 
Boston  &  Albany,  and  also  on  the  Troy  &  Greenfield 
Road  and  its  successor,  the  Fitchburg  Railroad,  the 
state  was  represented  by  state  directors  for  many  years. 

Compared  with  the  boldness  of  our  predecessors  in 
utilizing  the  credit  of  their  states  and  also  the  credit 
of  many  of  the  local  communities  for  connecting  links, 
to  prevent  New  England  from  being  left  behind  in  the 
new  era  of  railroad  building,  our  present  proposal  in 
relation  to  our  resources  of  today  seems  hardly  to  take 
courage  enough  to  fill  a  thimble. 

We  have  not  had  opportunity  to  develop  the  railroad 
history  of  our  other  New  England  states  but  we  could 
undoubtedly  find  many  instances  where  local  credit,  if 
not  state,  was  pooled  to  construct  needed  lines  or  links 
in  our  New  England  railway  systems. 

Large  public  expenditures  for  highways 

Quite  a  good  many  public  highways  and  bridges  in 
the  early  days  were  built  with  private  capital  in  return 
for  the  grant  of  tolls  and  if  the  states  and  communities 
had  not  taken  over  the  building  of  roads  we  would  have 
had  more  and  more  of  our  roads  and  bridges  built  with 
private  capital.  But  first  the  local  communities  and 
within  recent  years  the  states  also  have  supplied  the 


234 


capital  needed  to  construct  the  highways  and  have  pro¬ 
vided  the  great  sums  needed  annually  for  maintenance. 

Only  to  speak  of  recent  years,  since  1895,  the  six  New 
England  state  governments  have  expended  for  the  con¬ 
struction,  reconstruction  and  maintenance  of  highways 
$148,000,000.  At  the  present  time  they  are  spending 
annually  at  the  rate  of  $23,000,000  a  year,  less  than  half 
of  which  is  being  returned  in  the  form  of  motor  vehicle 
fees.  We  have  not  obtained  the  local  figures  from  all 
the  New  England  states  but  the  towns  and  cities  in 
Massachusetts  are  spending  additionally  on  the  roads 
at  least  twenty-five  million  dollars  a  year.  Our  roads 
are  necessary,  yes,  but  not  a  whit  more  than  our  rail¬ 
roads. 

Extensive  use  of  public  credit  for  municipal 

IMPROVEMENTS 

The  use  of  public  credit  in  the  Metropolitan  district 
of  Boston  alone  since  1895  for  water,  sewers,  and  parks 
has  amounted  to  eighty-two  million  dollars  one  hun¬ 
dred  per  cent  essential,  without  dispute,  so  far  at  least 
as  water  and  sewers  are  concerned,  but  besides  running 
water  our  people  if  their  welfare  is  to  be  conserved 
must  be  served  by  efficient  modern  rail  transportation 
facilities. 

Since  1894  the  city  of  Boston  has  pledged  its  credit 
for  approximately  thirty-seven  million  dollars  for  sub¬ 
ways  and  to  improve  rapid  transit  facilities. 

In  like  manner  other  communities  have  not  hesitated 
to  solve  the  problems  of  their  growing  needs  by  the 
utilization  of  their  public  credit. 


235 


REHABILITATION  OF  BOSTON  &  MAINE 

Our  review  of  the  financial  condition  of  the  Boston 
&  Maine  has  shown  that  it  is  in  weak  condition  and  that 
there  is  immediate  necessity  for  rehabilitation  of  its 
credit.  In  1921  its  deficit  after  interest  charges  was 
$6,612,422.  Although  1922  showed  fixed  charges  earned 
(by  the  narrow  margin  of  $27,992)  it  has  a  deficit  after 
fixed  charges  for  the  first  four  months  of  1923  of 
$4,632,471 ;  and  a  substantial  deficit  for  the  current  year 
seems  inevitable.  The  road  was  reorganized  in  1919 
and  the  fixed  charges  reduced  $2,725,862  chiefly  by  the 
holders  of  leased  line  stocks  taking  various  classes  of 
first  preferred  stocks.  The  first  preferred  stocks  have 
paid  no  dividends  since  July  1920  and  the  accumulated 
dividends  on  January  1,  1924  will  be  $7,125,230.  On 
that  date  the  rate  of  dividend  on  all  classes  of  first  pre¬ 
ferred  stocks  steps  up  twenty-five  per  cent  in  accord¬ 
ance  with  the  terms  of  the  reorganization  agreement. 

The  Boston  &  Maine  has  heavy  maturities  in  the 
next  twelve  years,  a  total  of  $93,145,679  beginning  with 
$1,505,200  in  1924,  $5,194,200  in  1925,  and  $10,720,200 
in  1926. 

We  suggest  a  plan  for  rehabilitation  by  cooperation 
similar  in  its  general  outline  to  the  rehabilitation  plan 
for  the  New  Haven  already  described. 

As  in  the  case  of  the  New  Haven,  this  plan  is  of¬ 
fered  as  a  tentative  suggestion  in  order  to  give  a  pic¬ 
ture  as  to  the  way  in  which  such  a  plan  might  be  ac¬ 
tually  worked  out. 


236 


As  a  starting  point  for  the  formulation  of  such  a 
plan  we  begin  with  an  estimate,  based  upon  the  condi¬ 
tions  we  shall  set  forth,  for  the  year  1925. 

Estimate  of  earnings  in  1925  under  normal 

CONDITIONS 

We  have  analyzed  with  care  the  earning  possibili¬ 
ties  of  the  Boston  &  Maine  Railroad  and  reached  the 
conclusion  that  in  1925,  assuming  that  its  operations 
are  conducted  efficiently,  the  gross  revenue  from  rail¬ 
way  operations  should  be  about  $86,180,000  under 
average  business  conditions,  and  that  the  net  revenue 
before  fixed  charges  should  be  about  $10,667,000.  After 
deducting  estimated  fixed  charges  of  $7,414,000  there 
should  remain,  in  our  judgment,  a  surplus  over  all 
expenses  and  charges  of  $3,253,000. 

We  believe  this  estimate  is  sound  and  not  over 
sanguine. 

As  in  the  case  of  the  New  Haven,  we  cannot  compare 
to  much  advantage  these  estimates  with  a  recent  normal 
year  because  1922  wTas  the  year  of  the  strikes  in  the 
textile  industry  and  the  coal  strike  which  both  affected 
coal  traffic  and  distorted  the  cost  of  locomotive  fuel, 
and  also  was  the  year  of  the  shop  strike,  while  1921  was 
a  period  of  acute  business  depression.  The  several 
years  before  1921  were  affected  by  war  conditions  and 
Federal  control.  We  give,  however,  our  estimate  in 
comparison  with  the  calendar  year  1922  and  in  compari¬ 
son  with  the  twelve  months  from  July  1, 1921,  to  July  1, 
1922,  which  does  not  include  the  shop  strike  period. 


237 


BOSTON  &  MAINE  RAILROAD 


Comparison  of  Earnings  for  Years  Ending  June  30,  1922,  and  December  31,  1922,  with 
Estimate  of  Earnings  in  1925  under  Normal  Conditions 


REVENUES 

F  ight  Revenue . 

P  i.senger  Revenue . 

Ml . 

Epress . 

Gier  Passenger  Transportation 
Cher  Freight  Transportation  . 
V  .terline  Transportation  .  .  . 

i’otal  Transportation.  .  .  . 
I:udental  Revenue  Passenger  . 

I  :idental  Revenue  Freight  .  . 
C  ler  Incidental  Revenues  .  . 
J  nt  Facility  Revenues.  .  .  . 


Total  Railway  Operating  Revenues  .  .  . 
EXPENSES 

Mintenance  of  Way  and  Structures  .... 

IN  lintenance  of  Equipment . 

fansportation . 

C  her  Expenses . 

Total  Railway  Operating  Expenses  .  .  . 

Net  Revenue  from  Railway  Operation  .  . 

TAXES  AND  RENTS 

Txes  . . 

Ire  of  Freight  Cars  (Net) . 

(her  Equipment  Rents  (Net) . 

J  nt  Facility  Rent . 

I  icollectible  Railway  Revenues . 

Total  Taxes  and  Rents . 

'Net  Railway  Operating  Income . 

1  >n-Operating  Income . 

Total  Net  Inc.  Available  for  Fixed  Charges 
FIXED  CHARGES 

1  :nt  for  Leased  Roads . 

1 terest . 

( her  Deductions . 

Total  Fixed  Charges . 

1  r  Cent  Total  Net  Income  to  Fixed  Charges 
.djustment  for  Period  of  Federal  Control 
AjNet  Income . 


Year  Ending 
June  30,  1922 

Per  cent 
Expenses 
to 

Revenues 

Year  Ending 
Dec.  31,  1922 

Per  cent 
Expenses 
to 

Revenues 

Estimate 

of 

Earnings 
in  1925 

Per  cent 
Expenses 
to 

Revenues 

$48,164,234 

$48,316,267 

$53,084,000 

22,916,914 

22,556,855 

23,578,000 

914,466 

995,185 

1,055,000 

2,253,871 

2,919,859 

3,155,000 

2,168,291 

2,266,538 

2,403,000 

735,789 

751,106 

826,000 

18,741 

$77,172,306 

$77,805,810 

$84,101,000 

463,833 

461,238 

489,000 

583,506 

572,405 

629,000 

766,685 

957,762 

958,000 

2,374 

2,908 

3,000 

$78,988,704 

$79,800,123 

$86,180,000 

$12,038,245 

15.24 

$11,076,742 

13.88 

$12,000,000 

13.92 

15^012, 657 

19.01 

16,112,965 

20.19 

15,563,000 

18.06 

36,834,916 

46.63 

36,445,903 

45.67 

38,793,000 

45.01 

3,633,995 

4.60 

3,418,787 

4.29 

3,419,000 

3.97 

$67,519,813 

85.48 

$67,054,397 

84.03 

$69,775,000 

80.96 

11,468,891 

12,745,726 

* 

16,405,000 

$2,298,676 

$2,580,677 

$2,850,000 

3,297,606 

3,740,974 

3,736,000 

Cr  .-49,873 

Ct.-18,850 

Ct.-18,000 

62,855 

Ct.-38,409 

Cr.-38,000 

8,420 

5,094 

5,000 

$5,618,184 

$6,269,986 

$6,535,000 

5,850,707 

6,475,740 

9,S70,000 

625,741 

797,209 

797,000 

$6,476,448 

$7,272,949 

$10,667,000 

$920,376 

$920,376 

$920,000 

5,937,532 

6,004,691 

6,455,000 

'  6L595 

39,428 

39,000 

$6,919,503 

$6,964,495 

$7,414,000 

93.60 

104.43 

143.88 

Cr  -470,595 

280,462 

27,540 

27,992 

3,253,000 

238 


Basis  of  Estimate 

The  figures  supporting  this  estimated  surplus  of 
$3,253,000  are  based  upon  an  estimated  increase  in 
freight  traffic  of  three  and  one-third  per  cent  a  year, 
or  a  ton  mile  movement  of  2,959,000,000  as  compared 
with  2,690,000,000  ton  miles  in  1922  when,  largely  due 
to  operating  difficulties,  the  volume  of  freight  handled 
by  the  Boston  &  Maine  reached  about  the  lowest  point 
during  the  last  seven  years.  The  road  actually  pro¬ 
duced  3,705,000,000  ton  miles  in  1920.  This,  it  is  true, 
was  a  period  of  very  active  business,  but  our  estimate  is 
for  1925,  five  years  later,  and  is  based  upon  2,959,000,000 
ton  miles,  or  actually  746,000,000  less  than  1920.  We 
believe  that  there  is  likely  to  be  some  recovery  in  pas¬ 
senger  business  from  the  low  level  of  1922,  and  have 
estimated  this  at  two  per  cent  a  year.  We  have  also 
estimated  that  mail,  express,  and  other  railway  operat¬ 
ing  revenues  will  increase  in  similar  proportions.  The 
actual  passenger  revenue  in  the  4  months  ending  April 
30,  1923,  increased  eight  per  cent  over  the  same  four 
months  of  1922.  While  this  was  doubtless  due,  in  part, 
to  the  severe  winter  and  the  consequent  reduction  in 
motor  car  competition,  we  think  these  last  4  months’ 
operations  reflect  a  general  improvement  in  business  in 
Boston  &  Maine  territory  and  that  a  moderate  improve¬ 
ment  in  passenger  traffic  on  the  Boston  &  Maine  is  prob¬ 
able  during  the  next  3  years. 

We  are  also  assuming  in  our  estimate  of  gross  rev- 


239 


enue  that  the  average  rates  for  freight,  passenger,  mail, 
and  express  will  remain  at  about  the  present  level. 

“  Normal  ”  expenses  for  Maintenance  of  Way  and 
Structures  we  estimate  at  $12,000,000.  This  is  $923,000 
greater  than  for  the  year  ending  Dec.  31,  1922,  sub¬ 
stantially  the  same  as  for  the  year  ending  June  30, 
1922,  and  somewhat  greater  than  the  average  for 
the  last  five  years,  1918  to  1922  inclusive,  when  the 
volume  of  traffic  averaged  considerably  more  than  in 
the  Committee’s  estimated  “normal  year”  (1925). 

In  our  estimate  of  expenses  for  Maintenance  of 
Equipment  we  are  assuming  that  the  cost  of  locomotive 
repairs  can  be  brought  down  somewhat  below  the  aver¬ 
age  for  1922  which  was  adversely  affected  by  the  shop 
strike  and  that  the  condition  of  the  equipment  and  the 
number  of  “  bad  order  ”  freight  cars  will  by  that  time 
be  brought  into  satisfactory  shape. 

It  is  probable  that  the  Boston  &  Maine  should  pur¬ 
chase  several  thousand  additional  freight  cars,  but  this 
estimate  does  not  take  into  account  the  possible  effect 
of  the  ownership  of  additional  cars. 

Our  estimate  of  Transportation  Expenses  assumes 
that  the  ten  additional  heavy  locomotives  already 
ordered  will  be  in  service;  that  there  will  be  no  im¬ 
portant  change  in  the  present  scale  of  wages ;  that  the 
cost  of  coal  will  be  about  the  same  as  in  the  year  end¬ 
ing  June  30, 1922 ;  that  winter  conditions  will  be  normal 
and  that  the  traffic  will  be  handled  with  efficiency.  We 
have  also  assumed  that  the  Transportation  Expenses 
incident  to  the  movement  of  freight  traffic  will  be  in¬ 
creased  over  those  of  the  year  ending  J une  30,  1922,  in 
direct  proportion  to  our  estimated  increase  in  traffic 


240 


and  that  other  Transportation  Expenses  will  increase 
over  1922  to  the  extent  of  seventy-five  per  cent  of  our 
estimated  increases  in  traffic.  We  have  reduced  cer¬ 
tain  other  minor  items  of  cost,  but  only  where  they 
were  clearly  abnormally  large  in  1922. 

Our  estimate  of  net  cost  for  Rentals  of  Freight  Cars 
has  been  based  upon  careful  study,  due  allowance  hav¬ 
ing  been  made  for  the  additional  ‘  ‘  foreign  *  ’  cars  re¬ 
quired  to  carry  the  estimated  additional  traffic,  and 
for  a  reasonably  efficient  car  movement. 

We  have  estimated  that  fixed  charges  will  increase 
by  about  $450,000  over  1922  representing  interest  on  an 
estimated  annual  expenditure  of  $2,500,000  for  addi¬ 
tions  and  improvements  to  the  property  and  equip¬ 
ment  during  three  years. 

Our  estimate  of  $3,253,000  net  income  would  give  a 
margin  in  an  average  year  of  about  44  per  cent  over 
fixed  charges.  This  margin,  however,  is  too  close  to 
establish  a  stout  credit  for  the  road.  In  order  to  build 
a  thoroughly  sound  credit,  the  road  should  be  able  to 
earn  in  an  average  year  approximately  twice  its  fixed 
charges  of  $7,414,000. 


241 


Early  Maturities  of  Boston  and  Maine  debt 


The  necessity  for  the  prompt  re-establishment  of 
first-class  credit  for  the  Boston  &  Maine  is  emphasized 
by  its  capital  requirements  for  refunding  its  present 
indebtedness  during  the  next  12  years : 


Due  U.  S.  Due  Total 

Year  Government  Others  Due 

1924  .  $1,505,200  $1,505,200 

1925  .  5,194,200  5,194,200 

1926  .  10,720,200  10,720,200 

1927  .  5,637,200  5,637,200 

1928  .  4,425,200  4,425,200 

1929  .  $28,303,500  11,984,200  40,287,700 

1930  .  5,443,979  4,951,700  10,395,679 

1931  .  3,049,000  1,117,200  4,166,200 

1932  .  2,775,200  2,775,200 

1933  .  5,975,200  1,975,200 

1934  .  2,826,200  2,S26,200 

1935  .  5,000,000  725,200  5,725,200 


Total  ....  $41,796,479  $57,836,900*  $99,633,379 


*  Includes  $1,826,400  Equipment  Trust  obligations  now  held  by  the  Director 
General  of  Railroads  which  are  subject  to  resale. 


It  will  be  noted  that  the  requirements  for  refund¬ 
ing  during  the  next  three  years  are  approximately 
$17,400,000  and  that  in  the  year  1929  the  maturities 
due  the  public  are  $11,984,200  besides  the  maturity  of 
$28,303,500  due  the  government. 


Suggested  Plan  for  Extension  of  Debt 

The  holders  of  $46,000,000  of  these  maturing  bonds 
should  cooperate  with  the  rehabilitation  plan  by  as¬ 
senting  to  an  extension  for  twelve  years  at  the  present 
rate  of  interest  except  that  for  the  period  of  the  ex¬ 
tension  bonds  now  receiving  a  coupon  rate  of  less  than 
five  per  cent  shall  be  brought  up  to  that  level,  and 
bonds  now  receiving  a  coupon  rate  of  more  than  six 


242 


per  cent  shall  be  brought  down  to  six  per  cent  for 
the  period  of  the  extension.  We  exclude  from  this 
extension  the  equipment  trust  obligations  and  ap¬ 
proximately  $1,838,000  of  underlying  first  mortgage 
bonds.  A  detailed  list  of  the  bonds  to  he  extended  ap¬ 
pears  in  Appendix  U.  The  extension  of  these  bonds 
will  cost  the  road  some  $300,000  increase  over  its  present 
fixed  charges  but  will  save  the  banking  expense  for 
refunding  and  will  assist  the  road  to  its  feet.  The 
bondholders  during  the  recent  receivership  contributed 
nothing,  and  as  their  principal  is  to  be  made  secure 
and  the  market  value  of  their  bonds  enhanced  it 
seems  fair  they  should  cooperate  to  this  extent. 
We  recommend  that  savings  banks  and  other  insti¬ 
tutions  and  fiduciaries  be  given  any  necessary  powers 
to  make  this  extension  and  to  hold  the  extended  bonds 
to  maturity. 

Cooperation  of  the  State 

Turning  now  back  to  our  estimated  surplus  of 
$3,253,000,  or  44  per  cent  above  fixed  charges,  it  is 
clear  that  while  this  average  would  enable  the  road 
to  earn  its  fixed  charges  in  an  average  year  yet  it 
is  not  margin  enough  for  an  abnormally  bad  year  or 
to  bufid  a  first-class  credit. 

Accordingly  we  suggest  that  the  states  served  by 
the  Boston  &  Maine,  viz.,  Maine,  New  Hampshire,  Ver¬ 
mont,  and  Massachusetts  should  undertake  to  return 
to  the  Boston  &  Maine  such  portion  of  the  taxes  paid 
to  or  within  these  several  states  as  may  be  needed  to 
enable  the  road  to  meet  any  failure  of  net  earnings  to 
cover  fixed  charges  for  that  year. 


243 


Tlie  taxes  paid  by  the  Boston  &  Maine  during  1922 
to  the  New  England  states  and  the  cities  and  towns 
wdthin  the  respective  states  were  —  Maine  $311,522, 
New  Hampshire  $846,421,  Vermont  $84,432,  Massa¬ 
chusetts  $1,245,673,  total  $2,488,049. 

It  is  not  proposed  that  the  cities  and  towns  should 
be  called  upon  to  return  the  taxes  paid,  but  that  each 
state  should  undertake  to  return  pro  rata  its  share  of 
the  tax  money  paid  to  the  state  or  the  cities  and  towns 
within  the  state  or  as  much  of  its  share  as  may  be 
needed  to  cover  any  deficit  in  fixed  charges. 

If  state  cooperation  is  to  be  thus  given  we  believe  that 
the  control  and  management  of  the  company  should  be 
vested  in  state  trustees  to  be  appointed  for  ten  years,  by 
the  several  states,  one  by  the  State  of  Maine,  two  by  the 
State  of  New  Hampshire,  one  by  the  State  of  Vermont 
and  three  by  the  State  of  Massachusetts.  We  do  not 
believe  in  divided  responsibility  and  therefore  do  not 
suggest  that  some  of  the  trustees  should  be  selected  by 
the  directors  or  stockholders  of  the  Boston  &  Maine. 
We  believe  it  will  be  best  to  have  all  trustees  appointed 
by  the  states  and  unreservedly  responsible  to  the  states 
and  to  the  public  for  what  they  may  do  or  leave  undone. 


No  READJUSTMENT  IN  CAPITALIZATION  REQUIRED 

It  may  be  asked  why  we  do  not  suggest  cutting  down 
the  bonded  indebtedness  and  substituting  preferred 
stock,  as  in  the  case  of  the  New  Haven.  The  question 
is  perhaps  open  to  argument  but  our  estimated  ratio 
of  net  earnings  to  fixed  charges  on  the  Boston  &  Maine 
is  somewhat  better  — 1.44  as  compared  with  1.35  for 


the  New  Haven.  There  has  also  been  an  actual  destruc¬ 
tion  or  permanent  loss  of  a  large  amount  of  capital  on 
the  New  Haven  which  seems  to  make  fair  a  concession 
on  the  part  of  the  New  Haven  bondholders  before  the 
states  step  in  to  help. 

The  “first  preferred  ”  stockholders  of  the  Boston 
&  Maine  who  hold  the  $38,817,900  par  value  of 
“  first  pref erred  ”  stock  formerly  held  leased  line 
stocks,  the  dividends  on  wdiich  were  guaranteed  by  the 
Boston  &  Maine  and  constituted  a  fixed  obligation  of 
the  company.  As  the  result  of  the  receivership  inau¬ 
gurated  in  August,  1916,  these  holders  of  leased  line 
stocks  waived  their  rights  and  took  first  preferred  stock 
upon  wdiicli  they  are  receiving  no  dividends  and  have 
received  no  dividends  since  1920. 

•  The  present  so-called  1 1  preferred  ’  *  shareholders  of 
the  Boston  &  Maine  hold  $3,149,800  par  value  of  an 
inferior  class  of  preferred  stock  because  at  the  time 
of  the  receivership  they  subordinated  their  right  to 
dividends  to  the  1 1  first  preferred  ’  ’  stock  so  as  to  as¬ 
sist  in  the  cutting  down  of  the  fixed  obligations  of  the 
company  and  also  consented  to  a  reduction  of  their 
dividend  rate  from  6  per  cent  to  4  per  cent  for  five 
years.  They  are  at  present  receiving  no  dividends  and 
have  received  none  since  1913,  except  that  dividends 
aggregating  6.67  per  cent  were  paid  on  this  stock  in 
1920. 

Under  the  circumstances  we  are  not  inclined  to  ask 
either  the  first  or  second  class  of  pref  erred  stockholders 
to  make  a  further  sacrifice  at  the  present  time. 

Neither  the  first  preferred  stock  nor  the  second  class 
of  preferred  stock  involve  a  fixed  charge  on  the  Bos- 


245 

ton  &  Maine  and  so  do  not  constitute  a  factor  adverse 
to  its  financial  stability. 

At  the  time  of  the  receivership  the  connnon  stock¬ 
holders  contributed  nothing  and  made  no  sacrifice;  in 
fact  their  position  was  improved  by  the  concession  of 
the  holders  of  the  leased  line  stocks.  It  would  be 
fair,  therefore,  to  ask  the  common  stockholders  to  buy 
new  common  stock  just  as  we  are  asking  the  New 
Haven  stockholders  to  buy  new  connnon  stock,  and  we 
have  considered  quite  seriously  doing  so,  but  we  have 
come  to  the  conclusion  that  in  this  case  results  com¬ 
mensurate  with  the  effort  cannot  be  obtained.  After 
counting  out  the  New  Haven’s  holdings  of  Boston  & 
Maine  stock,  we  should  get  from  the  remaining  Boston 
&  Maine  stockholders  less  than  $2,000,000,  if  they 
contributed  on  the  same  basis  that  gives  us  $15,000,000 
in  the  case  of  the  New  Haven.  We  think,  however, 
that  it  should  be  provided,  as  a  means  of  further 
strengthening  the  company,  that  for  the  first  three 
years  of  control  by  the  trustees  no  common  stock  divi¬ 
dends  be  paid,  and  that  during  the  last  seven  years  not 
more  than  half  the  amount  applicable  to  dividends  on 

the  common  stock  be  actually  declared  and  paid 

* 

thereon. 

We  have  given  much  thought  to  the  question  whether 
bonds  issued  by  the  state  trustees  should  carry  the 
guaranty  of  the  states  for  principal  and  interest,  and 
have  come  to  the  conclusion  that  it  is  in  the  best  in¬ 
terests  of  the  public  that  this  be  done.  If  the  states 
are  to  cooperate  in  financing  and  to  appoint  trustees, 
they  will  want  to  insure  the  success  of  the  plan.  The 
amount  of  bonds  so  to  be  guaranteed  could  if  desired 


( 


246 


be  limited  to  say  $2,500,000  a  year  for  additions  and 
improvements,  plus  whatever  relatively  small  amount 
will  be  required  for  the  refunding  of  those  bonds  now 
outstanding  which  after  the  proposed  plan  has  been 
put  into  effect  will  mature  within  the  period  of  con¬ 
trol.  The  liability  of  the  states  would  be  pro-rated 
among  them  on  the  basis  of  the  taxes  for  the  year 
preceding  the  issue.  It  might  be  preferable  for  the 
states  to  issue  their  own  bonds  and  with  the  proceeds 
to  buy  bonds  of  the  road  of  like  interest  rate  and 
maturity.  This  is  not  essential,  but  it  would  save  the 
road  interest  and  would  mean  a  lesser  liability  for  the 
state,  since  the  state  bonds  would  bring  a  higher  price. 

Cooperation  of  Federal  Government 

We  further  suggest  that  the  Federal  Government 
be  requested  to  aid  in  strengthening  the  credit  of  the 
Boston  &  Maine  by  taking  bonds  of  longer  maturity, 
bearing  4  per  cent  interest,  in  place  of  those  it  now 
holds. 

Cooperation  of  Shippers 

We  think  that  shippers  probably  should  be  asked 
to  lend  their  aid  by  reducing  the  present  two  days  of 
free  time  for  loading  or  unloading  to  one  day,  the 
second  day  to  have  a  moderate  demurrage  charge  of 
two  dollars.  This  will  quicken  car  movement  and  help 
to  offset  the  road’s  per  diem  debit  balance. 


247 


DEVOTION  AND  COURAGE  OF  EXECUTIVES 
OF  NEW  ENGLAND  ROADS 

This  Committee  wishes  to  record  that  as  the  result 
of  nearly  a  year’s  contact  it  has  learned  to  appreciate 
the  tremendous  burden  carried  now  for  so  long  by 
the  chief  executives  of  our  New  England  railroads  and 
more  especially  the  presidents  of  our  two  largest  sys¬ 
tems.  Taking  charge  of  their  respective  properties 
at  a  time  when  many  adverse  factors  and  especially 
financial  difficulties  had  already  developed,  they  have 
carried  their  burdens  through  the  war  and  through 
the  much  more  difficult  circumstances  which  have  de¬ 
veloped  since  the  war  with  unsparing  devotion  and 
great  courage.  The  fight  to  a  large  extent  has  been  a 
lonely  struggle  against  heavy  odds,  but  the  cause  in 
the  main  has  been  the  cause  of  New  England.  It  is  time 
the  people  of  New  England  appeared  on  the  scene  to 
lend  their  aid. 


248 

CONCLUSIONS 


Based  upon  its  ten  months’  study  of  the  New  Eng¬ 
land  transportation  problem  this  Committee  has 
reached  the  following  conclusions : 

General  Findings 

(1)  That  rail  transportation,  besides  its  essential 
passenger  side,  constitutes  a  plant  facility  absolutely 
necessary  to  the  maintenance  and  development  of  our 
industries.  The  locomotive  and  track  are  just  as 
necessary  to  our  factories,  with  possibly  a  few  ex¬ 
ceptions,  as  the  main  engine  which  drives  the  factory 
machinery.  Efficient  and  economical  management  of 
our  rail  systems  is  quite  as  important  to  us  as  efficient 
and  economical  management  of  our  factories.  That 
the  locomotive  has  been  under  different  ownership  and 
that  it  has  been  somebody  else’s  job  to  run  it  may  have 
tended  to  obscure  but  not  to  change  this  fact. 

(2)  That  due  to  New  England’s  situation  in  the 
nor  theast  corner  of  the  country  and  the  consequent  long 
in-and-out  rail  haul  and  because  seventy-five  per  cent 
of  our  industrial  enterprises  are  either  at  or  close  to 
the  coast  line  with  its  many  large  and  small  harbors, 
it  is  vital  to  New  England’s  future  welfare  that  a  close, 
friendly,  and  harmonious  cooperation  should  prevail 
at  all  times  between  our  rail  and  water  transportation. 

(3)  That  the  continuance  of  the  steel-railed  high¬ 
ways  of  New  England  in  condition  to  render  good  serv- 


249 


\ 


ice  to  its  people  is  just  as  important  as  the  maintenance 
and  improvement  of  tlie  “  ways  ”  more  connnonly  de¬ 
scribed  as  highways. 

(4)  That  this  coordinating  of  our  rail  and  water 
transportation  in  New  England  is  not  merely  for  the 
purpose  of  facilitating  exports  and  imports  as  is  largely 
the  case  with  the  territory  back  of  the  other  ports  of 
the  country,  but  is  vital  as  a  means  of  securing  our 
supplies  from  other  sections  of  this  country  and  send¬ 
ing  back  the  products  of  our  factories  in  exchange. 

(5)  That  we  produce  no  coal  or  grain  or  iron  or 
wool  or  cotton  or  other  basic  raw  materials  which 
the  rest  of  the  world  must  have,  so  that  to  get  them  it 
will  pay  at  least  any  reasonable  cost  of  transportation. 

(6)  That  transportation  costs  to  us  constitute  a 
weighted  factor  in  our  welfare  to  which  our  indus¬ 
tries  are  extremely  sensitive.  The  manufacture  of 
locomotives,  well  begun  in  New  England,  left  us  many 
years  ago  because  of  the  transportation  cost  of  the 
raw  materials.  The  coal  and  iron  mines  of  Pennsyl¬ 
vania  are  still  there  and  likewise  for  all  time  the  cotton 
fields  of  the  South  and  the  wonderful  corn  and  wheat 
producing  farms  of  the  great  Mississippi  valley.  If 
New  England’s  industries  are  ever  forced  into  a 
position  where  they  chiefly  depend  on  standard  trunk 
line  rates,  they  are  bound  to  suffer,  but  if  New  Eng¬ 
land  can  hold  its  own  knife  and  fork  and  feed  it¬ 
self  to  a  balanced  ration  of  standard  rates,  differential 
rates  and  water  rates,  we  see  no  reason  why  we  should 
not  maintain  full  bodily  vigor  and  continue  to  meet 
changing  conditions  by  new  adjustments  of  our  in¬ 
dustries  and  enterprises. 


250 


Specific  Findings 

(7)  That  the  Bangor  &  Aroostook  Railroad  is  in 
good  operating  and  financial  condition  and  serving  its 
territory  adequately  and  well. 

(8)  That  the  Maine  Central  Railroad  is  performing 
excellent  service  and  is  not  confronted  with  any  finan¬ 
cial  problem  threatening  its  usefulness. 

(9)  That  the  Rutland  Railroad  is  a  well  operated 
property  and,  though  not  paying  dividends,  is  being 
well  maintained  and  gradually  improved  from  year  to 
year  by  the  application  of  surplus  earnings. 

(10)  That  the  Boston  &  Albany  Railroad  is  giving 
the  industries  tributary  to  it  a  high  grade  of  service. 

(11)  That  the  Central  Vermont  is  performing  good 
service  and  that  its  stock  control  by  the  Grand  Trunk 
and  the  operating  relations  of  the  two  systems  place 
upon  the  Grand  Trunk  management  the  first  duty  to 
offer  the  Central  Vermont  financial  assistance  if  needed. 
The  same  is  true  of  the  Atlantic  &  St.  Lawrence  —  the 
Grand  Trunk  subsidiary  extending  to  Portland. 

(12)  That  the  Boston  &  Maine  is  inadequately  serv¬ 
ing  its  territory  and  is  in  such  financial  condition  that 
it  must  receive  aid  before  it  can  be  expected  to  properly 
care  for  the  people  and  industries  depending  upon  it. 

(13)  That  the  New  Haven  Railroad  is  affording  in¬ 
adequate  service  to  the  people  and  the  industries  lo¬ 
cated  on  the  system  and  that  its  financial  condition  is 
unsatisfactory  and  must  be  set  in  order  and  its  credit 
re-established  before  it  can  be  expected  to  properly  care 
for  the  people  and  industries  depending  upon  it. 


251 


Consolidation 

(14)  That  if  trunk  line  consolidation  should  be  made 
compulsory,  the  Boston  &  Maine,  and  as  an  essential 
consequence  the  Maine  Central  and  the  Bangor  &  Aroos¬ 
took,  should  he  consolidated  with  the  New  York  Cen¬ 
tral  and  the  New  Haven  with  the  Pennsylvania. 

(15)  That  in  the  opinion  of  this  Committee,  however, 
New  England  should  be  allowed  to  run  its  own  railroads, 
and  should  not  turn  one  over  to  the  Pennsylvania  with 
its  management  centered  in  Philadelphia,  nor  the 
others  to  the  New  York  Central  with  its  management 
centered  in  New  York  City.  Trunk  line  ownership 
would  substantially  eliminate  competition  among  the 
trunk  lines  for  New  England’s  westbound  business, 
and  with  it  one  of  the  greatest  incentives  to  good  serv¬ 
ice.  The  lower  rates  through  the  northern  gateways 
would  be  imperilled.  Cooperation  with  water  trans¬ 
portation  to  the  Pacific  Coast  via  the  Panama  Canal, 
and  to  midwestern  points  via  Savannah  and  other 
southern  ports,  might  be  adversely  affected  by  the  de¬ 
sire  of  the  trunk  lines  to  get  the  long  haul  which  the 
all-rail  route  would  give  them.  New  England  should 
oppose  the  taking  over  of  any  of  its  existing  lines  by 
the  trunk  lines.  The  Boston  &  Albany  should  remain, 
however,  as  a  part  of  the  New  York  Central  system  and 
the  Central  Vermont  and  the  Atlantic  &  St.  Lawrence 
as  parts  of  the  Grand  Trunk  system. 

(16)  That  if  there  is  to  be  a  New  England  system 
the  Rutland  Railroad  should  be  part  of  the  New  Eng¬ 
land  system  or  at  least  the  ownership  of  it  be  divided 
equally  between  the  New  York  Central  system  and 


252 


tlie  New  England  system;  the  New  York,  Ontario  & 
Western  Railroad  should  remain  in  the  New  Eng¬ 
land  system.  These  two  roads  give  New  England  a 
window  on  the  Great  Lakes. 

Rehabilitation  by  Cooperation 

(17)  That  the  terms  of  the  Transportation  Act  do 
not  make  compulsory  any  plan  that  finally  may  be 
promulgated  by  the  Interstate  Commerce  Commission. 
That  accordingly  a  consolidation  may  not  come  about 
next  year  or  the  year  following  or  for  five  years,  or 
indeed  ever. 

(18)  That  New  England  from  any  point  of  view, 
whether  in  favor  of  a  New  England  consolidation  or 
even  a  trunk  line  consolidation  or  of  no  consolidation 
at  all,  should  not  sit  on  the  doorstep  waiting  to  be 
taken  in  or  waiting  for  conditions  to  improve.  It  is 
in  the  interest  of  everyone  in  New  England,  whether 
a  shipper,  a  traveler  or  a  security  holder  in  one  of 
these  roads,  that  we  should  get  together  and  set  our 
two  major  systems  in  order  at  once. 

(19)  That  our  New  England  savings  banks,  which 
are  particularly  the  subject  of  solicitude  on  the  part 
of  our  states,  hold  a  hundred  million  of  the  securities 
of  these  two  roads,  and  that  this  fact  alone  seems  to 
justify  the  cooperation  of  our  states  in  a  plan  for 
putting  these  two  transportation  companies  on  a  sound 
basis. 

(20)  That  the  restoration  of  the  New  Haven  and 
Boston  &  Maine  properties  to  sound  health  cannot  be 
accomplished  without  fully  restoring  their  credit.  No 
half-way  measures  should  be  taken. 


253 


Rehabilitation  of  the  New  Haven 

(21)  That  the  existing  common  stockholders  of  the 
New  Haven  should  subscribe  or  undertake  to  have  sub¬ 
scribed  at  or  about  market  value  an  additional  amount 
of  common  stock  sufficient  to  bring  into  the  road’s 
treasury  $15,000,000,  which  should  be  applied  in  part 
at  least  to  the  reduction  of  the  road’s  indebtedness  by 
payment  of  outstanding  bonds  or  their  purchase  at  the 
lowest  price  at  which  they  are  obtainable. 

That  in  order  to  enable  this  to  be  done,  appropriate 
legislation  should  be  enacted  to  place  the  common  stock 
on  a  non-par  basis  in  order  to  permit  the  issue  and 
sale  of  additional  common  stock  at  less  than  the  pres¬ 
ent  par. 

(22)  That  the  bondholders  of  the  New  Haven  Com¬ 
pany  are  not  in  comfortable  position  today  and  should 
be  willing  to  cooperate  with  the  states  to  put  the  New 
Haven  on  a  stable  basis  and  as  their  contribution  to 
such  a  plan,  should  be  willing  to  exchange  $75,000,000 
par  value  of  their  securities  for  a  first  preferred  stock 
which  shall  have  its  rights  to  dividends  and  principal 
placed  ahead  of  the  rights  of  the  common  stockholders, 
as  more  particularly  set  forth  in  Appendix  T.  The 
bondholders  should  also,  as  set  forth  in  that  appendix, 
extend  $7,329,000  par  value  of  their  holdings  to  Novem¬ 
ber,  1937,  at  six  per  cent. 

(23)  That  the  Federal  Government  be  requested  to 
fund  the  New  Haven  Company’s  indebtedness  to  it 
for  a  reasonable  period  at  four  per  cent  interest. 

(24)  That  the  power  to  control  the  New  Haven 
Company  and  its  operations  and  finances  be  vested 


254 


in  a  board  of  five  trustees  appointed  for  ten  years  by 
the  several  states,  two  by  the  State  of  Connecticut,  one 
by  the  State  of  Rhode  Island  and  two  by  the  State  of 
Massachusetts. 

(25)  That  if  the  New  Haven  is  fully  to  rehabilitate 
its  credit  so  that  it  can  promptly  and  efficiently  serve 
the  communities  dependent  on  it  still  more  must  be 
done;  that  it  is  not  enough  to  make  its  ability  to 
meet  its  fixed  charges  a  probability — it  should  be  made 
a  practical  certainty.  Under  the  circumstances  this 
cannot  be  satisfactorily  accomplished  without  the  co¬ 
operation  of  the  states. 

(26)  That  the  states  of  Connecticut,  Rhode  Island, 
and  Massachusetts  shall  undertake  that  in  any  year 
in  which  the  earnings  of  the  New  Haven  do  not  equal 
its  fixed  charges,  each  will  refund  such  portion  of 
the  total  taxes  levied  by  it  and  locally  within  its 
limits  during  that  year  in  which  the  deficit  occurs 
as  may  be  necessary  to  meet  the  deficit,  but  there  shall 
not  thus  be  refunded  by  any  state  more  than  the  amount 
of  such  taxes.  We  do  not  mean  that  the  cities  and  towns 
shall  be  called  upon  to  repay  taxes  levied  by  them,  but 
merely  that  the  total  of  taxes  levied  within  the  state 
shall  be  the  measure  of  the  contribution  of  the  state. 

(27)  That  the  states  of  Connecticut,  Rhode  Island, 
and  Massachusetts,  in  order  further  to  ensure  the  sta¬ 
bility  and  credit  of  the  New  Haven  Company,  under¬ 
take  to  guarantee  principal  and  interest  of  a  specified 
amount  of  bonds  to  be  issued  by  the  state  trustees  dur¬ 
ing  the  period  of  control,  this  amount  to  be  calculated 
to  cover  the  amount  of  the  bonds  now  outstanding 
which  after  the  readjustment  we  propose  will  mature 


255 


during  tlie  period  of  control  by  tlie  trustees  plus,  say 
$4,000,000  a  year  for  additions  and  improvements,  the 
liability  of  the  states  to  be  several,  and  to  be  appor¬ 
tioned  among  them  in  the  ratios  of  the  taxes  levied  on 
the  New  Haven  by  them  and  locally  within  their  limits 
during  the  year  preceding  the  issue  of  the  bonds. 

Rehabilitation  of  the  Boston  &  Maine 

(28)  That  the  bondholders  of  the  Boston  &  Maine 
should  be  glad  to  assist  in  its  rehabilitation,  and  should 
be  asked  for  this  purpose  to  extend  for  twelve  years 
some  $46,000,000  of  bonds  maturing  prior  to  Decem¬ 
ber  31, 1935,  as  set  forth  in  more  detail  in  Appendix  TJ. 

(29)  That  the  Federal  Government  be  requested  to 
exchange  the  bonds  of  the  Boston  &  Maine  that  it  holds 
for  other  bonds  bearing  a  lower  rate  of  interest  and  of 
a  longer  maturity. 

(30)  That  the  entire  power  to  control  the  Boston 
&  Maine  and  its  operations  and  finances  be  vested  in 
a  board  of  seven  trustees,  appointed  for  ten  years  by 
the  several  states,  two  by  the  State  of  New  Hampshire, 
one  by  the  State  of  Maine,  one  by  the  State  of  Vermont, 
and  three  by  the  State  of  Massachusetts. 

(31)  That  the  states  of  Massachusetts,  New  Hamp¬ 
shire,  Maine,  and  Vermont  shall  undertake  that  in  any 
year  in  which  the  earnings  of  the  Boston  &  Maine  do 
not  equal  its  fixed  charges  each  will  refund  such  por¬ 
tion  of  the  total  taxes  levied  by  it  and  locally  within 
its  limits  during  such  year  as  may  be  necessary  to  meet 
the  deficit,  but  not  more  than  the  total  amount  of  such 
taxes.  We  do  not  mean  that  the  cities  and  towns  shall 
be  called  upon  to  repay  taxes  levied  by  them,  but 


256 


merely  that  the  total  of  taxes  levied  within  the  state 
shall  be  the  measure  of  the  contribution  of  the  state. 

(32)  That  the  states  of  Massachusetts,  New  Hamp¬ 
shire,  Maine,  and  Vermont,  in  order  further  to  en¬ 
sure  the  stability  and  credit  of  the  Boston  &  Maine, 
shall  undertake  to  guarantee  principal  and  interest  of 
a  specified  amount  of  bonds  to  be  issued  by  the  state 
trustees  during  the  period  of  control,  this  amount  to 
be  calculated  to  cover  the  bonds  now  outstanding  which 
after  the  plan  we  propose  has  been  put  into  effect  will 
mature  during  the  period  of  control  by  the  trustees, 
plus,  say  $2,500,000  a  year  for  additions  and  improve¬ 
ments,  the  liabilitv  of  the  states  to  be  several  and  to  be 
apportioned  among  them  in  the  ratios  of  the  taxes 
levied  on  the  Boston  &  Maine  by  them  and  locally 
within  their  limits  during  the  year  preceding  the  issue 
of  the  bonds. 

Final 

(33)  We  suggest  that  committees  be  appointed  by 
the  several  states  to  act  jointly  in  formulating  a 
detailed  program  for  the  rehabilitation  of  the  New 
Haven  and  Boston  &  Maine  systems,  and  if  such  joint 
Committee  receives  from  the  stockholders  and  bond¬ 
holders  reasonable  assurance  of  cooperation  a  special 
session  of  the  legislature  of  each  of  the  six  New  Eng¬ 
land  states  should  be  called  to  meet  in  October  for  the 
purpose  of  dealing  with  the  rehabilitation  of  these  two 
railroad  svstems. 


257 


Vermont 

James  F.  Dewey,  Chairman 
Walton  F.  Andrews 
Ralph  M.  Buck 
N.  Nelson  Jackson 
Hugh  J.  M.  Jones 

New  Hampshire 

Lester  F.  Thurber,  Chairman 
Clarence  E.  Carr 
Benjamin  W.  Couch 
Arthur  H.  Hale 
James  P.  Richardson 

Massachusetts 

James  J.  Storrow,  Chairman 
Carl  Dreyfus 
Adolph  W.  Gilbert 
Frank  H.  Willard 

Rhode  Island 

George  L.  Crooker,  Chairman 
Howard  W.  Fitz 
Wesley  F.  Morse 
Everett  E.  Salisbury 
William  Trafton 

Connecticut 

E.  Kent  Hubbard,  Chairman 
Stanley  H.  Bullard 
Frederick  L.  Ford 
Edward  0.  Goss 
George  S.  Stevenson 

Howard.  G.  Kelley,  Technical  Adviser 


258 


Reservation  of  New  Hampshire  Committee 

We  the  undersigned  members  of  the  Committee  sign  the 
report  with  the  reservation  that  we  dissent  from  the  con¬ 
clusions  reached  by  the  Committee  to  the  effect  that  sub¬ 
sequent  to  the  success  of  the  plan  for  rehabilitation  of  the 
New  Haven  and  the  Boston  &  Maine  Railroads  there  should 
be  a  consolidation  of  the  New  England  railroads  into  a 
regional  group  as  set  forth  in  the  report. 

We  do  not  believe  that  there  should  be  any  consolidation 
of  New  England  railroads  at  the  present  time. 

We  believe  that  the  two  major  New  England  railroads 
can  obtain  substantial  rehabilitation  by  the  plan  described 
in  the  report,  but  we  believe  that  if  consolidations  must 
then  follow,  they  should  be  with  the  trunk  lines. 

The  government  offers  assistance  to  financially  weak 
railroads  of  the  country  by  annexation  to  the  financially 
strong  trunk  lines.  We  believe  that  the  two  major  New 
England  railroads  are  the  fairest  of  examples  of  financially 
weak  railroads  in  need  of  the  financial  strength  of  the  trunk 
lines.  By  reason  of  additional  operating  costs  inherent  in 
New  England,  the  New  England  railroads  will  always  have 
to  carry  an  excess  load.  If  the  government  is  willing  to 
distribute  through  financially  strong  trunk  lines  our  excess 
burdens  of  motor  truck  competition  in  congested  territory, 
our  burden  of  terminal  costs,  switching  charges,  fuel  costs 
and  the  short  hauls,  we  cannot  in  the  long  run  afford  to 
decline  the  offer  in  justice  to  New  England  industry. 

The  example  of  the  efficiency  of  service  of  the  Boston 
&  Albany  Railroad  as  shown  in  detail  in  the  report  leads 
us  to  abandon  all  fear  of  outside  control.  We  think  that 
efficient  and  prompt  service  with  adequate  facilities 
throughout  New  England  will  automatically  take  care  of 
the  Canadian  Gateway  problem,  that  the  port  developments 
should  be  made  by  the  states,  or  by  the  states  and  the  steam¬ 
ship  lines  together,  and  not  by  the  railroads,  and  that  the 


259 


coastwise  shipping  should  be  independent  and  competitive 
for  the  good  of  New  England  industry. 

We  do  not  believe  that  the  New  England  transportation 
properties  should  be  put  on  the  trunk  line  bargain  counter, 
nor  do  we  think  that  the  government  would,  or  could  if  it 
would,  force  trunk  line  consolidations  upon  any  terms 
which  would  constitute  confiscation  of  property,  the  value 
of  which  has  already  been  tentatively  determined  by  gov¬ 
ernment  agency. 

Lester  F.  Thtjrber,  Chairman 
Clarence  E.  Carr 
Benjamin  W.  Couch 
Arthur  H.  Hale 
James  P.  Richardson 


Statement  of  Maine  Committee 

We  concur  in  the  findings  and  conclusions  of  the  report 
in  respect  of  the  choice  between  proposed  plans  of  railroad 
consolidation,  if  some  form  of  consolidation  be  required. 
We  feel  bound  to  state,  however,  that  in  our  judgment  the 
interests  of  Maine  would  be  adversely  affected  by  the 
adoption  of  any  form  of  consolidation  considered  by  the 
Committee. 

Carl  E.  Milliken,  Chairman 
Charles  E.  Gurney 
Edward  W.  Wheeler 
L.  E.  McIntire 
Edwin  M.  Hamlin 


260 


Statement  of  Philip  Dexter 

Biarritz,  June  30,  1923. 

Governor  Cox,  State  House,  Boston,  Mass. 

A  copy  of  the  report  of  the  Committee  appointed  to  con¬ 
sider  the  railroads  has  been  forwarded  to  me.  While  I 
agree  with  much  of  it  there  are  portions  from  which  I  dis¬ 
sent  as  follows : 

Our  principal  railroads  are  unable  to  earn  enough  to 
maintain  their  credit  because  present  wages  and  car  hire 
leave  insufficient  net  earnings  but  discussion  of  delay  in  car 
movement  is  futile.  Whenever  a  car  is  received  there  is  im¬ 
mediately  a  question  whether  to  make  up  a  train  or  wait  for 
more  cars  and  pay  rentals.  The  operating  officers  are  quite 
aware  of  this  and  in  my  opinion  have  shown  good  judgment 
in  handling  cars.  It  is  unfair  to  measure  operating  effi¬ 
ciency  by  car  delays  without  regard  to  the  conditions  under 
which  business  must  be  done  and  idle  to  calculate  earnings 
upon  an  improvement  in  car  movement  which  would  cost 
far  more  than  it  would  save.  The  nature  of  the  railroad 
business  in  New  England  will  always  make  it  impossible  to 
attain  the  rapidity  of  movement  which  other  railroads  can 
secure. 

With  respect  to  the  New  Haven  it  is  unfair  to  lay  stress 
upon  the  losses  of  capital  which  have  occurred.  The  value 
of  the  property  which  remains  and  which  is  devoted  solely 
to  railroad  purposes,  is  sufficient  to  maintain  high  credit  if 
it  were  possible  to  earn  five  per  cent  on  that  value.  It  is  a 
question  of  earnings  not  of  capital  and  the  New  Haven  is 
unable  to  get  the  earnings  because  of  the  high  cost  above 
mentioned.  The  road  is  as  efficiently  operated  as  circum¬ 
stances  permit  and  its  failure  to  secure  sufficient  earnings 
is  due  to  causes  beyond  the  control  of  its  officers. 

It  is  in  my  judgment  a  mistake  for  the  committee  to  rec¬ 
ommend  any  plan  of  financial  reorganization  such  as  is  out- 


261 


lined  in  the  report.  I  think  the  plans  are  inadequate  and 
the  committee  insufficiently  informed  on  this  subject  to  en¬ 
able  it  to  formulate  a  plan  without  further  study.  It  is  not 
properly  within  our  province  and  we  have  not  given  it 
sufficient  attention. 

With  respect  to  consolidation  I  agree  that  if  the  matter 
can  be  adjourned  for  a  time  we  shall  be  likely  to  reach  a 
wiser  conclusion  but  if  that  is  impossible  it  seems  to  me 
clear  that  the  interests  of  Massachusetts  and  of  New  England 
will  be  injured  by  a  consolidation  of  our  railroads  into  one 
system.  The  danger  of  such  a  step  is  alarming.  It  would 
in  my  opinion  result  in  increased  rates  which  would  hurt 
our  industries.  The  evidence  taken  by  the  committee  estab¬ 
lishes  to  my  mind  that  a  New  England  railroad  will  be  even 
more  unable  to  give  good  service  than  our  present  roads 
and  will  be  from  the  beginning  on  the  verge  of  financial 
collapse.  A  consolidation  of  our  roads  with  trunk  lines  on 
the  other  hand  is  promising.  There  are  undoubtedly  objec¬ 
tions  to  either  course  but  it  is  clear  from  the  evidence  that 
the  interests  of  everybody  concerned  which  means  the  whole 
population  of  New  England  will  be  far  better  served  by  a 
consolidation  with  the  trunk  lines.  The  New  York  Central 
has  found  it  profitable  to  give  good  service  to  the  industries 
on  the  line  of  the  Boston  &  Albany.  It  will  be  equally  ad¬ 
vantageous  to  trunk  lines  to  build  up  industry  along  our 
other  road  then  the  eventual  profit  will  go  to  them.  I  am 
satisfied  that  the  danger  of  trunk  line  control  has  been  much 
exaggerated  and  can  easily  be  overcome  while  the  more 
serious  danger  inherent  in  a  New  England  consolidation 
has  not  received  enough  attention. 

There  can  be  no  doubt  that  the  port  of  Boston  and  the  co¬ 
ordination  of  the  railroads  and  their  terminals  should  be 
taken  in  hand  at  once  and  I  am  in  accord  with  that  part  of 
the  report  though  the  subject  would  seem  to  require  further 
study. 

There  are  other  matters  of  minor  consequence  with  which 
I  will  not  trouble  you  now. 


Philip  Dextee. 


. 


263 


APPENDIX  A 

NET  CAPITAL  EXPENDITURES  FOR  ROAD  AND  EQUIPMENT  —  ALL  NEW  ENGLAND  RAILROADS 

JULY  1,  1914,  to  DECEMBER  31,  1922 
(Including  Improvements  on  Leased  Railway  Property) 


Account 

New  York, 
New  Haven 
&  Hartford 

Central 
New  Eng. 

Total 

New  Haven 
C.  N.  E. 

Boston 

& 

Maine 

Boston 

& 

Albany 

Maine 

Central 

Bangor 

& 

Aroostook 

C.  Vermont 
(excluding 
Canadian  Lines) 

Rutland 

Atlantic 

& 

St.  Lawrence 

Total 

Road 

Engineering . 

Grading . 

Bridges,  Trestles  and  Culverts . 

Track  Materials  and  Labor,  Track  Laying 

and  Surfacing . 

Station  and  Office  Buildings . 

Shops  and  Engine  Houses . 

Crossings  and  Signs . 

Telegraph  and  Telephone  Lines . 

Signals  and  Interlockers . 

Power  Plants  and  Transmission  Lines .... 

Shop  Machinery . 

All  Other . 

81,074,060 

6,600,436 

4,214,473 

6,935,910 

3,725,126 

2,367,053 

2,093,009 

1,261,017 

1,917,810 

1,829,956 

1,001,964 

2,014,752 

$31,223 

229,817 

127,088 

298,312 

194,491 

304,808 

131,993 

24,774 

16,310 

26,272 

65,790 

-47,934 

$1,105,283 

6,830,253 

4,341,561 

7,234,222 

3,919,617 

2,671,861 

2,225,002 

1,285,791 

1,934,120 

1,856,228 

1,067,754 

1,966,818 

$561,127 

2,002,063 

3,461,741 

2,739,116 

1,070,743 

2,678,498 

1,241,832 

32,564 

688,085 

556,886 

273,911 

620,685 

$162,070 

435,738 

603,354 

1,464,722 

345,867 

136,862 

393,958 

111,833 

158,007 

79,195 

90,809 

632,296 

$37,191 

431,357 

1,039,182 

746,212 

297,563 

262,956 

128,094 

3,966 

73,911 

23,506 

135,952 

209,508 

$6,565 

238,804 

38,078 

456,512 

94,546 

154,426 

20,165 

307 

19,891 

-3,444 

80,699 

276,250 

$4,133 

19,885 

102,553 

253,715 

300,786 

73,550 

56,157 

5,062 

5,548 

133,414 

82,325 

$670 

92,945 

147,036 

568,490 

160,716 

512,576 

74,855 

255 

1,218 

4,683 

73,436 

48,801 

$373 

19,249 

49,074 

711,091 

167,684 

93,651 

18,695 

8,263 

151,958 

384 

37,538 

25,656 

$1,877,412 

10,070,294 

9,782,579 

14,174,080 

6,357,522 

6,584,380 

4,158,758 

1,448,041 

3,032,738 

2,518,438 

1,893,513 

3,862,339 

Total  Road . 

$35,035,566 

$1,402,944 

$36,438,510 

$15,927,251 

$4,614,711 

$3,389,398 

$1,383,799 

$1,037,128 

$1,685,681 

$1,283,616 

$65,760,094 

Equipment 

Steam  and  Other  Locomotives . 

Freight  Train  Cars . 

Passenger  Train  Cars . 

Other  Equipment  Expenditures . 

$8,239,825 

3,818,665 

8,323,154 

1,411,284 

$724,671 

-63,869 

14,431 

9,721 

$8,964,496 

3,754,796 

8,337,585 

1,421,005 

$3,106,485 

5,665,745 

1,358,908 

199,296 

$1,725,776 

675,984 

1,455,257 

155,286 

$1,681,057 

1,931,400 

302,246 

-189,332 

$544,396 

622,235 

27,830 

120,003 

$250,313 

116,100 

16,464 

79,225 

$271,113 

-31,434 

114,254 

21,400 

$5,372 

95,945 

$16,549,008 

12,744,826 

11,612,544 

1,902,828 

Total  Equipment . 

General  Expenditures . 

$21,792,928 

1,475,337 

$684,954 

19,724 

$22,477,882 

1,495,061 

$10,330,434 

156,468 

$4,012,303 

10,845 

$3,725,371 

17,958 

$1,314,464 

19,073 

$462,102 

1,740 

$385,333 

8,222 

$101,317 

3,400 

$42,809,206 

1,712,767 

Grand  Total . 

$58,303,831 

$2,107,622 

$60,411,453 

$26,414,153 

$8,637,859 

$7,132,727 

$2,717,336 

$1,500,970 

$2,079,236 

$1,388,333 

$110,282,067 

-  Italics  indicate  Credits 


' 


265 


APPENDIX  B  1 


INTERCHANGE  OF  NEW  ENGLAND  RAILROADS  WITH  CONNECTIONS 
CLASSIFIED  BY  NEW  ENGLAND  RAILROADS 
(Year  Ending  June  30,  1922) 


Railroad 

Cars  Received 

Cars  Delivered 

Cars  Received  and  Delivered  —  Grand  Total 

Loaded 

Empty 

Total 

Loaded 

Empty 

Total 

Loaded 

Percent  of 
Total  Loaded 

Empty 

Grand 

Total 

New  Haven  .... 

Boston  &  Maine . 

Boston  &  Albany . 

Maine  Central  .  . 

Bangor  &  Aroostook  .  .  . 
Central  Vermont  . 

Rutland . 

Total . 

422,838 

284,745 

268,460 

36,539 

4,698 

39,320 

40,791 

1,097,391 

47,764 

20,948 

21,492 

5,611 

1,574 

4,952 

9,273 

111,614 

470,602 

305,693 

289,952 

42,150 

6,272 

44,272 

50,064 

1,209,005 

161,080 

105,619 

102,998 

15,650 

2,455 

26,987 

28,558 

319,345 

193,085 

175,793 

29,535 

3,222 

20,324 

24,593 

480,425 

298,704 

278,791 

45,185 

5,677 

47,311 

53,151 

583,918 

390,364 

371,458 

52,189 

7,153 

66,307 

69,349 

37.9 

25.3 

24.1 

3.4 

0.5 

4.3 

4.5 

100.0 

367,109 

214,033 

197,285 

35,146 

4,796 

25,276 

33,866 

877,511 

951,027 

604,397 

568,743 

87,335 

11,949 

91,583 

103,215 

2,418,249 

443,347 

765,897 

1,209,244 

1,540,738 

267 


APPENDIX  B2 

INTERCHANGE  OF  NEW  ENGLAND  RAILROADS  WITH  CONNECTIONS 

CLASSIFIED  BY  GATEWAYS 
(Year  Ending  June  30,  1922) 


Gateway 

Cars  Received 

Cars  Delivered 

Cars  Received  and  Delivered  —  Grand  total 

Loaded 

Empty 

Total 

Loaded 

Empty 

Total 

Loaded 

Percent  of 
Total  Loaded 

Empty 

Total 

Western  Gateways 

(Trunk  Line  Connections) 
Harlem  River . 

246,611 

35,536 

282,147 

120,381 

179,679 

300,060 

366,992 

23.8 

215,215 

582,207 

Maybrook . 

176,227 

12,228 

188,455 

40,699 

139,666 

180,365 

216,926 

14.1 

151,894 

368,820 

Albany . 

Mechanicville 

268,460 

21,492 

289,952 

102,998 

175,793 

278,791 

371,458 

24.1 

197,285 

568,743 

(and  Rotterdam  Jet.)  .  .  . 

247,425 

16,826 

264,251 

89,167 

164,272 

253,439 

336,592 

21.8 

181,098 

517,690 

Rutland . 

7,738 

2,417 

10,155 

5,494 

5,731 

11,225 

13,232 

0.9 

8,148 

21,380 

Total  Western  Gateways  .  . 

946,461 

88,499 

1,034,960 

358,739 

665,141 

1,023,880 

1,305,200 

84.7 

753,640 

2,058,840 

Northern  Gateways 

(Canadian  Connections) 
Norwood . 

23,290 

5,878 

29,168 

21,670 

13,620 

35,290 

44,960 

2.9 

19,498 

64,458 

Swanton  . 

49,611 

6,035 

55,646 

28,560 

26,187 

54,747 

78,171 

5.1 

32,222 

110,393 

Newport  . 

36,792 

4,017 

40,809 

16,273 

28,192 

44,465 

53,065 

3.5 

32,209 

85,274 

Maine  Central . 

12,889 

4,631 

17,520 

11,567 

12,003 

23,570 

24,456 

1.6 

16,634 

41,090 

Bangor  &  Aroostook  .... 

1,055 

1,562 

2,617 

2,439 

324 

2,763 

3,494 

0.2 

1,886 

5,380 

Total  Northern  Gateways  .  . 

123,637 

22,123 

145,760 

80,509 

80,326 

160,835 

204,146 

13.3 

102,449 

306,595 

Eastern  Gateways 

(Canadian  Connections  to 
Maritime  Provinces) 

Bangor  &  Aroostook 

(Van  Buren  &  Other  Points 
Maine  Central 

3,643 

12 

3,655 

16 

2,898 

2,914 

3,659 

0.2 

2,910 

6,569 

(Vanceboro  &  Other  Points) 

23,650 

980 

24,630 

4,083 

17,532 

21,615 

27,733 

1.8 

18,512 

46,245 

Total  Eastern  Gateways  .  .  . 

27,293 

992 

28,285 

4,099 

20,430 

24,529 

31,392 

2.0 

21,422 

52,814 

Grand  Total . 

1,097,391 

111,614 

1,209,005 

443,347 

765,897 

1,209,244 

1,540,738 

100.0 

877,511 

2,418,249 

r 


• 

. 


269 


APPENDIX  B  3 


APPENDIX  B  3 


INTERCHANGE  OF  NEW  ENGLAND  RAILROADS  WITH  CONNECTIONS 

CLASSIFIED  BY  CONNECTING  LINES 

(Yeab  Ending  June  30,  1922) 


Connecting  Lines 


New  York  Central . 

Delaware  &  Hudson  .  .  .  ’ 

Pennsylvania . 

Lehigh  &  Hudson  River  .  . 

Grand  Trunk . 

Canadian  Pacific  .  . 

Erie . 

Lehigh  Valley .  ’ 

Central  R.R.  of  New  Jersey 
Lehigh  &  New  England 

Long  Island  . 

New  York,  Ontario  and  Western 

Quebec  Central . 

New  York  Terminal  Companies 
Quebec,  Montreal  &  Southern  . 

Canadian  National  . 

Albany  Southern  (Electric)  ) 
Norwood  &  St.  Lawrence  .  . 

Total . 

Percent  of  Grand  Total .... 


Cars  Received  from  Connecting  Lines 


Loaded 


375,470 

188,232 

149,977 

77,108 

57,120 

51,662 

48,422 

50,516 

33,390 

29,277 

4,165 

12,708 

3,447 

6,986 

4,060 

3,817 

746 

288 

1,097,391 


Empty 


33,228 

14,578 

13,830 

3,684 

9,520 

6,367 

5,610 

3,448 

6,790 

499 

7,771 

1,089 

176 

2,299 

187 

34 

1,242 

1,262 

111,614 


Total 


408,698 

202,810 

163,807 

80,792 

66,640 

58,029 

54,032 

53,964 

40,180 

29,776 

11,936 

13,797 

3,623 

9,285 

4,247 

3,851 

1,988 

1,550 

1,209,005 


Cars  Delivered  to  Connecting  Lines 


Loaded 


155,113 

65,502 

64,965 

24,002 

36,551 

23,430 

11,645 

12,591 

21,688 

310 

10,550 

2,345 

605 

9,451 

479 

105 

1,907 

2,108 

443,347 


Empty 


254,495 

129,149 

107,499 

51,038 

37,691 

36,946 

39,395 

37,772 

20,805 

30,186 

1,335 

10,421 

2,973 

418 

2,420 

3,206 

102 

46 

765,897 


Total 


409,608 

194,651 

172,464 

75,040 

74,242 

60,376 

51,040 

50,363 

42,493 

30,496 

11,885 

12,766 

3,578 

9,869 

2,899 

3,311 

2,009 

2,154 

1,209,244 


Cars  Received  and  Delivered  —  Grand  Total 


Loaded 

Percent  of 
Total  Loaded 

Empty 

530,583 

34.4 

287,723 

253,734 

16.5 

143,727 

214,942 

13.9 

121,329 

101,110 

6.5 

54,722 

93,671 

6.1 

47,211 

75,092 

4.9 

43)313 

60,067 

3.9 

45,005 

63,107 

4.1 

41,220 

55,078 

3.6 

27,595 

29,587 

1.9 

30,685 

14,715 

1.0 

9,106 

15,053 

1.0 

11,510 

4,052 

0.2 

3,149 

16,437 

1.1 

2,717 

4,539 

0.3 

2)607 

3,922 

0.2 

3,240 

2,653 

0.2 

1,344 

2,396 

0.2 

1,308 

1,540,738 

100.0 

877,511 

63.7% 

36.3% 

Total 


818,306 

397,461 

336,271 

155,832 

140,882 

118,405 

105,072 

104,327 

82,673 

60,272 

23,821 

26,563 

7,201 

19,154 

7,146 

7,162 

3,997 

3,704 

2,418,249 

100.0% 


271 


APPENDIX  C 

Description  of  Freight  Traffic  of  New  England 

Railroads 

The  principal  commodities  handled  by  the  New  England 
roads  are  shown  in  the  following  statement: 

(Year  ending  December  31,  1922) 

Tons  Per  cent 
Commodity  Handled  of  Total 

Anthracite  and  Bituminous  Coal .  18,078,372  22.93 

Miscellaneous  Manufactures .  10,954,564  13.89 

Less  than  Carload  Freight .  6,617,047  8.39 

Grain,  Flour  and  other  Mill  Products,  Hay,  Straw  and 

Alfalfa .  6,574,616  8.34 

Lumber  and  other  Products  of  Forests .  6,453,743  8.18 

Cement,  Brick,  Lime  and  Plaster .  3,868,165  4.91 

Refined  Petroleum  and  its  Products .  3,273,742  4.15 

Clay,  Gravel,  Sand,  Stone  and  other  Products  of  Mines, 

except  Coal  and  Coke .  3,268,365  4.15 

Potatoes .  2,596,603  3.29 

Paper,  Printed  Matter  and  Books .  2,491,740  3.16 

Pulp  Wood .  1,885,642  2.39 

Bar  and  Sheet  iron,  Structural  Iron,  Iron  Pipe,  other 

Metals,  Pig,  Bar  and  Sheet .  1,751,374  2.22 

Fruit  ana  Vegetables  and  other  Products  of  Agriculture  1,387,058  1.76 

Fresh  Meats,  other  Packing  House  Products,  Canned 

Goods .  1,277,543  1.62 

Ice . 1,241,770  1.58 

Iron,  Pig  and  Bloom,  Castings,  Machinery  and  Boilers  1,168,434  1.49 

Chemicals  and  Explosives .  830,205  1.05 

Unclassified  Tonnage .  825,507  1.05 

Cotton .  669,995  .85 

Other  Products  of  Animals .  524,304  .66 

Sugar,  Syrup,  Glucose  and  Molasses .  514,896  .65 

Coke . 500,927  .64 

Textiles .  465,300  .59 

Hides  and  Leather .  416,113  .53 

Automobiles  and  Auto  Trucks .  394,748  .50 

Live  Stock .  389,842  .50 

Wool .  302,935  .38 

Rails  and  Fastenings .  122,080  .15 


Total .  78,845,630  100.00 


Coal  Traffic 


Coal  is  the  largest  single  item  of  traffic  on  the  New  Eng¬ 
land  roads.  In  1922  the  movement  of  anthracite  coal  was 
below  normal  because  of  the  coal  strike  which  lasted  from 
April  1st  to  September  15th.  The  tonnage  of  anthracite 
and  bituminous  coal  and  the  percentage  of  each  to  total 
traffic  last  year  as  compared  with  1921  on  the  three  prin¬ 
cipal  roads  were  as  follows: 


Anthracite 

New  Haven  .  .  . 
Boston  &  Maine  . 
Boston  &  Albany  . 

Bituminous 
New  Haven  .  .  . 
Boston  &  Maine  . 
Boston  &  Albany  . 


Tons  of  Coal  Handled 


1921 

Per  cent  of 

1922 

Per  cent  of 

Total  Traffic 

Total  Traffic 

.  .  3,433,352 

15.6 

2,026,780 

8.4 

.  .  2,791,699 

13.9 

1,728,913 

8.1 

.  .  1,492,975 

17.1 

749,700 

8.0 

.  .  3,375,663 

15.3 

3,926,888 

16.2 

.  .  2,432,132 

12.1 

2,449,931 

11.5 

.  .  1,772,804 

20.3 

1,788,110 

19.0 

It  will  be  noted  that  while  there  was  a  large  decrease  in 
the  movement  of  anthracite  coal,  there  was  an  increase  in 
the  movement  of  bituminous  coal.  This  was  due  chiefly  to 
the  fact  that  while  the  strike  in  the  anthracite  coal  regions 
was  complete,  and  during  the  period  of  the  strike  little 
anthracite  coal  moved  into  New  England,  in  the  case  of 
the  bituminous  coal  there  was  not  only  a  large  movement 
of  coal  into  New  England  from  non-union  mines  but  also 
a  large  quantity  of  foreign  coal  was  received  at  the  New 
England  ports,  and  the  movement  of  this  coal  from  tide¬ 
water  to  interior  points  offset  to  a  certain  extent  the  loss 
of  the  all-rail  movement  from  the  union  fields. 


Petroleum  and  Its  Products 
During  recent  years  the  tonnage  of  petroleum  and  its 
products  has  become  important  because  of  the  substitution 
on  a  large  scale  by  New  England  industries  of  fuel  oil  for 
coal.  The  growth  of  this  traffic  since  1912  on  the  New 
Haven,  Boston  &  Maine,  Boston  &  Albany  and  Maine  Cen¬ 
tral  which  carry  most  of  it,  is  as  follows: 


Petroleum  and  Its  Products — Tons  Handled  in 

1912  and  1922 

1912  Per  cent  1922  Per  cent 
of  Total  of  Total 

Traffic  Traffic 


New  Haven* .  397,069  1.61  1,631,115  6.73 

Boston  &  Maine .  230,755  .97  870,352  4.09 

Boston  &  Albany  .  138,465  1.59  326,800  3.47 

Maine  Central .  40,267  .59  9-38.748  3.25 


•Does  not  include  Central  New  England. 


273 


A  large  tonnage  of  lumber  and  other  forest  products, 
pulpwood,  paper  and  potatoes  is  originated  on  the  Ban¬ 
gor  &  Aroostook  and  Maine  Central,  but  as  the  traffic 
carried  by  each  road  will  be  given  later  in  some  detail  we 
will  not  attempt  to  describe  the  general  characteristics 
of  New  England  freight  traffic  further  than  to  comment 
on  its  high  percentage  of  less  than  carload  traffic. 

Less  Than  Carload  Traffic 
A  distinguishing  feature  of  freight  traffic  on  the  New 
England  lines  is  the  large  percentage  of  less  than  carload 
freight  to  total.  In  1922  a  total  of  23,935,273  tons  of  freight 
originated  on  the  New  England  railroads  of  which  3,731,012 
tons,  or  15.59  per  cent  was  less  than  carload  traffic.  During 
the  same  period  the  total  tonnage  originating  on  all  the  rail¬ 
roads  of  the  United  States  was  1,023,165,630  tons,  of  which 
43,168,067  tons,  or  only  4.22  per  cent  was  less  than  carload 
freight.  While  the  New  England  railroads  originated  only 
2.34  per  cent  of  the  total  tonnage  of  the  United  States  they 
originated  8.64  per  cent  of  the  less  than  carload  tonnage. 

The  following  table  shows  the  relation  between  less  than 
carload  traffic  and  total  traffic  originated  on  the  different 
New  England  railroads  (year  ending  December  31,  1922) : 


Tons  Originated 

Per  cent  less 

than  carload 

Less  than  Carload  Total 

to  total  orig- 

Road 

inated 

New  Haven . 

.  .  .  1,641,514 

8,267,432 

19.85 

Boston  &  Maine . 

.  .  .  1,201,161 

6,620,179 

18.14 

Boston  &  Albany . 

.  .  .  375,631 

2,372,980 

15.83 

Maine  Central . 

.  .  .  313,472 

3,506,807 

8.94 

Central  Vermont . 

.  .  .  79,411 

715,292 

11.10 

Rutland . 

.  .  .  66,863 

422,064 

15.84 

Bangor  &  Aroostook  .  .  .  . 

.  .  .  19,466 

1,580,720 

1.23 

Atlantic  &  St.  Lawrence  .  . 

.  .  .  33,494 

449,799 

7.45 

Total  New  England  .  .  .  . 

.  .  .  3,731,012 

23,935,273 

15.59 

Total  United  States  .  .  .  . 

.  .  .  43,168,067 

1,023,165,630 

4.22 

These  statistics  refer  only  to  tonnage  originated,  not 
total  tonnage  carried. 

We  give  in  the  following  table  the  tonnage  of  less  than 
carload  freight  carried  and  the  percentage  of  this  traffic  to 
total  tonnage  carried  in  1922,  as  compared  with  1912,  for 
the  New  Haven  and  Boston  &  Maine,  the  only  two  roads  for 
which  the  comparison  is  available.  The  figures  for  the  New 


274 


Haven  exclude  the  Central  New  England  to  avoid  duplica¬ 
tion  of  tonnage  interchanged  between  these  roads. 

Total  Less  Than  Carload  Freight  Carried 


1912  Per  cent  1922  Per  cent 
Tonnage  of  Total  Tonnage  of  Total 

New  Haven* .  3,934,985  15.95  2,409,673  9.95 

Boston  &  Maine .  1,781,547  7.51  1,950,547  9.16 


*  Does  not  include  Central  New  England. 

This  statement  shows  an  increase  of  169,000  tons  on  the 
Boston  &  Maine,  and  a  loss  of  1,525,312  tons  on  the  New 
Haven.  This  falling  off  on  the  New  Haven  undoubtedly 
reflects  the  increase  in  motor  truck  transportation  which 
has  been  very  large  since  1917,  especially  in  Southern  New 
England. 

Tonnage  carried  by  principal  commodities  in  1912  and 
1922  for  the  individual  New  England  roads  is  given  in  the 
following  tables.  The  classification  of  commodities  under 
which  the  tonnage  was  reported  in  1922  has  been  condensed 
to  correspond  as  closely  as  possible  with  the  classification 
used  in  1912. 


PAGE 


New  Haven . 275 

Boston  &  Maine . 276 

Boston  &  Albany . 277 

Maine  Central . 278 

Central  Vermont . 279 

Bangor  &  Aroostook . 280 

Rutland .  ....  281 


275 


"NEW  HAVEN  RAILROAD* 

Tons  of  Revenue  Freight  Carried  by  Commodities 

1912  and  1922 

Products  of  Agriculture 

1.  Grain . 

2.  Flour . 

3.  Other  Mill  Products  .... 

4.  Hay .  . 

5.  Tobacco . 

6.  Cotton . 

7.  Fruit  and  Vegetables  .... 

8.  Other  Products  of  Agriculture 

Products  of  Animals 

9.  Live  Stock  . 

10.  Dressed  Meats . 

11.  Other  Packing  House  Products 

12.  Poultry,  Game  and  Fish  .  .  . 

13.  Wool . 

14.  Hides  and  Leather . 

15.  Other  Products  of  Animals 

Products  of  Mines 

16.  Anthracite  Coal . 

17.  Bituminous  Coal . 

18.  Coke . 

19.  Ores . 

20.  Stone, Sand,  and  other  like  article 

21.  Other  Products  of  Mines  .  . 

Products  of  Forests 

22.  Lumber . 

23.  Other  Products  of  Forests  .  . 

Manufactures 


24.  Petroleum  and  Other  Oils  .  . 

25.  Sugar . 

26.  Naval  Stores . 

27.  Iron,  Pig  and  Bloom  .... 

28.  Iron  and  Steel  Rails  .... 

29.  Other  Castings  and  Machinery 

30.  Bar  and  Sheet  Metal  .... 

31.  Cement,  Brick  and  Lime  .  . 

32.  Agricultural  Implements  .  . 

33.  Wagons,  Carriages,  etc.  .  .  . 

34.  Wines,  Liquors  and  Beers  .  . 

35.  Household  Goods  and  Furniture 

36.  Other  Manufactures  .... 

37.  Other  Carload  Commodities  . 

38.  Less  than  Carload  Freight 


Total  Tons  Carried  . 24,675,469 

Revenue  Ton  Miles .  2,343,040,000 

Average  Haul  —  Miles .  94.95 


1912 

Per  cent 

1922 

Per  cent 

Tons 

op  Total 

Tons 

op  Total 

691,288 

2.80 

370,992 

1.53 

256,477 

1.04 

327,675 

1.35 

236,297 

.96 

581,149 

2.40 

277,325 

1.12 

209,545 

.87 

16,324 

.06 

22,152 

.09 

223,867 

.91 

275,068 

1.14 

352,321 

1.43 

819,516 

3.38 

42,136 

.17 

149,829 

.62 

46,210 

.19 

45,232 

.19 

148,100 

.60 

166,387 

.69 

18,810 

.08 

18,523 

.08 

40,957 

.17 

10,719 

.04 

124,082 

.50 

112,495 

.47 

123,983 

.50 

127,008 

.53 

203,234 

.82 

191,994 

.79 

!, 366, 613 

9.59 

2,026,780 

8.37 

:, 133,374 

16.75 

3,926,888 

16.22 

125,234 

.51 

210,337 

.87 

68,984 

.28 

9,279 

.04 

.,053,607 

4.27 

782,780 

3.23 

73,838 

.30 

212,354 

.88 

,043,825 

4.23 

1,303,786 

5.38 

118,738 

.48 

164,459 

.68 

397,069 

1.61 

1,631,115 

6.73 

48,153 

.19 

153,865 

.63 

460 

.00 

976 

A 

273,183 

1.11 

330,647 

1.36 

125,495 

.51 

34,222 

.14 

246,619 

1.00 

245,935 

1.02 

533,340 

2.16 

931,259 

3.84 

985,180 

3.99 

1,356,757 

5.60 

1,660 

.01 

21,163 

.08 

15,572 

.06 

86,602 

.35 

154,368 

.63 

42,838 

.18 

31,986 

.13 

26,077 

.11 

.,935,306 

7.84 

1,582,085 

6.53 

,206,469 

17.05 

3,305,375 

13.64 

,934,985 

15.95 

2,409,673 

9.95 

t, 675, 469 

100.00  24,223,536 

100.00 

2,552,128,000 

107.68 


•Does  not  include  Central  New  England. 
A.  Less  than  .005  per  cent  of  total. 


276 


BOSTON  &  MAINE  RAILROAD 

Tons  of  Revenue  Freight  Carried  by  Commodities 


1912  AND  1922 


Products  of  Agriculture .  Tons 

1.  Grain .  1,178,677 

2.  Flour .  437,302 

3.  Other  Mill  Products .  368,617 

4.  Hay .  544,497 

5.  Tobacco .  30,088 

6.  Cotton  and  Products .  231,798 

7.  Vegetables  and  Fruit .  831,195 

8.  Other  Products  of  Agriculture  .  97,293 

Products  of  Animals 

9.  Live  Stock  .  134,759 

10.  Dressed  Meats .  257,918 

11.  Other  Packing  House  Products  .  173,656 

12.  Poultry,  Game  and  Fish  ....  81,468 

13.  Wool .  123,829 

14.  Hides  and  Leather .  207,469 

15.  Other  Products  of  Animals  .  .  25,828 

Products  of  Mines 

16.  Anthracite  Coal .  1,736,404 

17.  Bituminous  Coal .  2,885,636 

18.  Coke .  195,492 

19.  Ores .  88,849 

20.  Stone,  Sand  and  Other  Like 

Articles .  1,310,761 

21.  Other  Products  of  Mines  .  .  .  41,374 

Products  of  Forests 

22.  Lumber .  2,296,813 

23.  Other  Products  of  Forests  .  .  .  698,403 

Manufactures 

24.  Petroleum  and  Other  Oils  .  .  .  230,755 

25.  Sugar  .  203,607 

26.  Naval  Stores .  47,539 

27.  Iron,  Pig  and  Bloom .  156,166 

28.  Iron  and  Steel  Rails .  96,519 

29.  Other  Castings  and  Machinery  .  400,092 

30.  Bar  and  Sheet  Metal .  94,593 

31.  Cement .  177,093 

32.  Brick .  362,435 

33.  Lime .  136,479 

34.  Agricultural  Implements  .  .  .  49,803 

35.  Autos,  Trucks,  Wagons,  Car¬ 

riages,  Tools,  etc .  41,615 

36.  Wines,  Liquors  and  Beers  .  .  .  219,075 

37.  Household  Goods  and  Furniture  132,588 

38.  Other  Carload  Commodities  .  .  5,586,955 

39.  Less  than  Carload  Freight  .  .  1,781,547 


Total  Tons  Carried .  23,694,987 

Revenue  Ton  Miles .  2,460,991,000 

Average  Haul  —  Miles .  103.86 


A.  Less  than  .005  per  cent  of  total. 


Per  cent 

1922  Per  cent 

of  Total 

Tons  of  Total 

4.97 

724,873 

3.40 

1.85 

320,320 

1.50 

1.56 

481,117 

2.26 

2.30 

163,162 

.77 

.13 

7,565 

.04 

.98 

225,393 

1.06 

3.51 

1,062,342 

4.96 

.41 

48,895 

.23 

.57 

73,695 

.35 

1.09 

105,293 

.49 

.73 

90,992 

.43 

.34 

10,517 

.05 

.52 

84,979 

.40 

.88 

157,427 

.74 

.11 

121,177 

.57 

7.33 

1,728,913 

8.12 

12.18 

2,449,931 

11.50 

.83 

123,437 

.58 

.37 

8,051 

.04 

5.53 

787,407 

3.70 

.17 

208,529 

.98 

9.69 

2,068,140 

9.71 

2.95 

612,235 

2.87 

.97 

870,352 

4.09 

.86 

112,247 

.53 

.20 

888 

A 

.66 

82,152 

.38 

.41 

38,844 

.18 

1.69 

173,158 

.81 

.40 

318,714 

1.50 

.75 

390,925 

1.84 

1.53 

292,373 

1.37 

.58 

153,545 

.72 

.21 

48,640 

.23 

.17 

93,796 

.44 

.92 

16,017 

.07 

.56 

37,213 

.17 

23.58 

5,051,915 

23.73 

7.51 

1,950,547 

9.16 

100.00 

21,295,716 

100.00 

. .  2,689,915,000 
126.31 


277 


BOSTON  &  ALBANY  RAILROAD 

Tons  of  Revenue  Freight  Carried  by  Commodities 

1912  and  1922 


Products  of  Agriculture 

1.  Grain . 

2.  Flour . 

3.  Other  Mill  Products . 

4.  Hay . 

5.  Tobacco . 

6.  Cotton . 

7.  Fruit  and  Vegetables . 

8.  Other  Agricultural  Products  .  . 

Products  of  Animals 

9.  Live  Stock  . 

10.  Dressed  Meats . 

11.  Other  Packing  House  Products  . 

12.  Poultry,  Game  and  Fish  .... 

13.  Wool . 

14.  Hides  and  Leather . 

15.  Other  Products  of  Animals  .  . 

Products  of  Mines 

16.  Anthracite  Coal . 

17.  Bituminous  Coal . . 

18.  Coke . . 

19.  Ores . 

20.  Stone,  Sand  and  Other  Like 

Articles . 

21.  Other  Products  of  Mines.  .  .  . 

Products  of  Forests 

22.  Lumber . 

23.  Other  Products  of  Forests  .  .  . 

Manufactures 

24.  Petroleum  and  Other  Oils  .  . 

25.  Sugar . 

26.  Naval  Stores . 

27.  Iron,  Pig  and  Bloom  .... 

28.  Iron  and  Steel  Rails  .... 

29.  Other  Castings  and  Machinery 

30.  Bar  and  Sheet  Metal  .... 

31.  Cement,  Brick  and  Lime  .  . 

32.  Agricultural  Implements  .  . 

33.  Wines,  Liquors  and  Beers  .  . 

34.  Household  Goods  and  Furniture 

35.  Other  Manufactures  .... 

36.  All  Other  Commodities  .  .  . 

Total  Tons  Carried . 

Revenue  Ton  Miles . 

Average  Haul  —  Miles . 

A.  Less  than  .005  per  cent  of  total. 


1912 

Per  cent 

1922  Per  cent 

Tons 

op  Total 

Tons  op  Total 

478,327 

5.51 

310,963 

3.31 

168,503 

1.94 

191,690 

2.04 

152,955 

1.76 

232,874 

2.48 

146,830 

1.69 

119,650 

1.27 

4,053 

.05 

691 

.01 

88,564 

1.02 

53,051 

.56 

150,023 

1.73 

193,142 

2.05 

73,724 

.85 

65,902 

.70 

280,123 

3.22 

219,325 

2.33 

59,376 

.68 

169,143 

1.80 

99,919 

1.15 

58,717 

.62 

17,795 

.20 

16,931 

.18 

74,326 

.85 

62,869 

.67 

102,632 

1.18 

59,456 

.63 

90,923 

1.05 

84,041 

.89 

797,716 

9.18 

749,700 

7.97 

1,332,595 

15.34 

1,788,110 

19.01 

81,461 

.94 

132,689 

1.41 

21,553 

.25 

4,628 

.05 

510,647 

5.88 

273,443 

2.91 

52,030 

.60 

71,872 

.76 

263,236 

3.03 

241,312 

2.57 

128,194 

1.4S 

47,085 

.50 

138,465 

1.59 

326,800 

3.47 

42,779 

.49 

55,834 

.59 

29,796 

.34 

136 

A 

142,447 

1.64 

57,242 

.61 

7,304 

.OS 

16,636 

.18 

185,180 

2.13 

115,808 

1.23 

254,609 

2.93 

287,744 

3.06 

583^543 

6.72 

727,321 

7.73 

2,303 

.03 

4,459 

.05 

52,622 

.60 

6,274 

.07 

26,616 

.31 

12,248 

.13 

1,658,134 

19.08 

1,767,464 

18.79 

'389,273 

4.48 

881,150 

9.37 

8,688,576 

100.00 

9,406,380 

100.00 

972,359,000  ..  1,089,660,000 

111.91  ..  115.84 


278 


MAINE  CENTRAL  RAILROAD 

Tons  of  Revenue  Freight  Carried  by  Commodities 

1912  and  1922 


Products  of  Agriculture 

1912 

Tons 

Per  cent 
or  Total 

1922 
Tons  i 

Per  cent 
of  Total 

1.  Grain . 

288,091 

4.24 

228,721 

3.11 

2.  Flour  . 

75,008 

1.11 

65,116 

.88 

3.  Other  Mill  Products . 

88,182 

1.30 

178,388 

2.43 

4.  Hay . 

171,213 

2.52 

31,510 

.43 

5.  Cotton . 

22,112 

.33 

32,023 

.44 

6.  Potatoes . 

565,156 

8.33 

787,283 

10.71 

7.  Fruit  and  Vegetables . 

89,706 

1.32 

27,791 

.38 

8.  Other  Products  of  Agriculture  . 

22,424 

.33 

6,046 

.08 

Products  of  Animals 

9.  Live  Stock  . 

20,625 

.31 

15,764 

.21 

10.  Dressed  Meats . 

11,993 

.18 

12,684 

.17 

11.  Other  Packing  House  Products  . 

19,968 

.29 

4,753 

.06 

12.  Poultry,  Game  and  Fish  .... 

13,630 

.20 

309 

A 

13.  Wool . 

5,496 

.08 

4,921 

.07 

14.  Hides  and  Leather . 

20,992 

30,172 

.31 

9,824 

.13 

15.  Other  Products  of  Animals  .  . 

.44 

9,952 

.14 

Products  of  Mines 

16.  Anthracite  Coal . 

124,510 

1.83 

137,920 

1.87 

17.  Bituminous  Coal . 

612,596 

9.02 

711,656 

9.68 

18.  Coke . 

6,998 

1,435 

.10 

10,116 

.14 

19.  Ores . 

.01 

416 

.01 

20.  Stone,  Sand  and  Other  Like 

Articles . 

138,857 

2.04 

135,530 

1.84 

21.  Other  Products  of  Mines  .  .  . 

78,615 

1.16 

93,649 

1.27 

Products  of  Forests 

22.  Lumber . 

1,041,609 

15.33 

934,446 

12.71 

23.  Railroad  Ties . 

62,945 

737,503 

.93 

10,254 

.14 

24.  Pulp  Wood . 

10.86 

906,214 

12.32 

25.  Other  Products  of  Forests  .  .  . 

392,322 

5.77 

128,425 

1.75 

Manufactures 

26.  Petroleum  and  other  Oils  .  .  . 

40,267 

.59 

238,748 

3.25 

27.  Sugar  . 

15,499 

.23 

16,356 

.22 

28.  Naval  Stores . 

1,526 

.02 

440 

.01 

29.  Iron,  Pig  and  Bloom . 

13,625 

.20 

3,386 

.05 

30.  Rails,  Iron  and  Steel . 

28,160 

.41 

11,905 

.16 

31.  Other  Castings  and  Machinery  . 

28,899 

.42 

20,699 

.28 

32.  Metal,  Bar  and  Sheet . 

5,120 

.08 

13,749 

.19 

33.  Cement . 

26,074 

.38 

58.342 

.79 

34.  Agricultural  Implements  .  .  . 

3,359 

.05 

4,820 

.07 

35.  Autos,  Wagons,  Carriages  and 

other  Vehicles . 

3,435 

.05 

13,281 

.18 

36.  Household  Goods  and  Furniture 

10,799 

.16 

2,938 

.04 

37.  Brick . 

25,147 

.37 

22,448 

133,110 

.31 

38.  Lime . 

107,863 

1.59 

1.81 

39.  Paper . 

477,447 

7.03 

654,596 

8.90 

40.  Acids . 

7,346 

.11 

58,582 

.80 

41.  Ice  . 

31,281 

.46 

35,980 

.49 

42.  All  Other  Commodities  .... 

1,325,514 

19.51 

1,579,607 

21.48 

Total  Tons  Carried . 

6,793,519 

100.00 

7,352,698 

100.00 

612,514,000  . . .  857,667,000 

90.16  ...  116.65 


Revenue  Ton  Miles . 

Average  Haul  —  Miles  .  .  .  . 

A.  Less  than  .005  per  cent  of  total. 


279 


CENTRAL  VERMONT  RAILWAY 

Tons  of  Revenue  Freight  Carried  by  Commodities 

1912  and  1922 


Products  of  Agriculture 

1.  Grain . 

2.  Flour . 

3.  Other  Mill  Products . 

4.  Hay . 

5.  Other  Products  of  Agriculture  . 

Products  of  Animals 

6.  Live  Stock  . 

7.  Packing  House  Products  .  .  . 

8.  Hides  and  Leather . 

9.  Other  Products  of  Animals  .  . 

Products  of  Mines 

10.  Anthracite  Coal . 

11.  Bituminous  Coal . 

12.  Granite,  Clay,  Gravel  and  Sand 

13.  Other  Products  of  Mines  .  .  . 

Products  of  Forests 

14.  Lumber . 

15.  Pulp  Wood . 

16.  Other  Products  of  Forests  .  .  . 

Manufactures 

17.  Petroleum  and  Oils . 

18.  Brick,  Cement  and  Lime  .  .  . 

19.  All  Other  Commodities  .... 

Total  Tons  Carried . 


1912 

Per  cent 

1922 

Per  cent 

Tons 

of  Total 

Tons 

of  Total 

355,662 

8.82 

348,900 

9.03 

84,546 

2.10 

98,403 

2.55 

139,835 

3.47 

199,519 

5.16 

253,528 

6.28 

37,833 

.98 

85,265 

2.11 

160,850 

4.16 

28,543 

.71 

17,702 

.46 

45,251 

1.12 

128,659 

3.33 

18,245 

.45 

27,968 

.72 

53,364 

1.32 

54,500 

1.41 

305,237 

7.57 

196,201 

5.08 

553,020 

13.71 

312,276 

8.08 

120,313 

2.98 

205,809 

5.32 

162,557 

4.03 

31,388 

.81 

350,418 

8.69 

405,382 

10.49 

26,723 

.66 

67,455 

1.74 

115,599 

2.87 

77,409 

2.00 

24,500 

.61 

113,583 

2.94 

91,174 

2.26 

91,030 

2.35 

,219,859 

30.24 

1,290,822 

33.39 

,033,639 

100.00 

3,865,689 

100.00 

',505,000  . .  369,128,000 

76.73  . .  95.49 


Revenue  Ton  Miles 
Average  Haul  —  Miles 


280 


BANGOR  &  AROOSTOOK  RAILROAD 

Tons  of  Revenue  Freight  Careied  by  Commodities 

1912  and  1922 


Products  of  Agriculture 

1.  Grain . 

2.  Flour . 

3.  Other  Mill  Products . 

4.  Hay . 

5.  Fruits  and  Vegetables . 

6.  Potatoes . 

7.  Other  Products  of  Agriculture  . 

Products  of  Animals 

8.  Live  Stock  . 

9.  Dressed  Meats . 

10.  Other  Packing  House  Products  . 

11.  Wool . 

12.  Hides  and  Leather . 

13.  Other  Products  of  Animals  .  . 

Products  of  Mines 

14.  Anthracite  Coal . 

15.  Bituminous  Coal . 

16.  Coke . 

17.  Stone,  Sand  and  Other  Like 

Articles . 

18.  Other  Products  of  Mines  .  .  . 

Products  of  Forests 

19.  Lumber . 

20.  Other  Products  of  Forests  .  .  . 

Manufactures 

21.  Fertilizer . 

22.  Starch . 

23.  Petroleum  and  Other  Oils  .  .  . 

24.  Sugar . 

25.  Naval  Stores . 

26.  Iron  and  Steel  Rails . 

27.  Other  Castings  and  Machinery  . 

28.  Cement,  Brick  and  Lime  .  .  . 

29.  Agricultural  Implements  .  .  . 

30.  Wagons,  Carriages,  Tools,  etc.  . 

31.  Wines,  Liquors  and  Beers  .  .  . 

32.  Household  Goods  and  Furniture. 

33.  Paper . 

34.  All  Other  Commodities  .... 


1912 

Per  cent 

1922 

Per  cent 

Tons 

op  Total 

Tons 

of  Total 

14,612 

.81 

19,952 

.92 

6,625 

.37 

6,418 

.30 

11,528 

.64 

10,697 

.50 

42,436 

2.36 

12,574 

.58 

3,500 

.20 

1,878 

.09 

388,323 

21.64 

532,896 

24.70 

560 

.03 

448 

.02 

1,963 

.11 

1,722 

.08 

121 

.01 

273 

.01 

2,187 

.12 

1,220 

.06 

22 

474 

.02 

6,116 

.34 

1,182 

.05 

1,287 

.07 

64 

A 

34,662 

1.93 

4,771 

.22 

137,072 

7.64 

267,897 

12.42 

234 

.01 

193 

.01 

16,466 

.92 

19,352 

.90 

33,810 

1.89 

2,587 

.12 

359,058 

20.01 

262,697 

12.18 

362,141 

20.18 

396,280 

18.37 

79,707 

4.44 

105,196 

4.88 

2,232 

.12 

4,681 

.22 

3,400 

.19 

19,485 

.90 

2,101 

.12 

2,592 

.12 

281 

.02 

58 

A 

10 

332 

.02 

10,314 

.57 

5,539 

.26 

18,577 

1.04 

26,075 

1.21 

1,426 

.08 

1,037 

.05 

828 

.05 

880 

.04 

105 

.01 

89 

A 

384 

.02 

229 

.01 

151,659 

8.45 

248,142 

11.50 

100,666 

5.61 

119,109 

9.24 

Total  Tons  Carried .  1,794,413  100.00  2,157,019  100.00 

Revenue  Ton  Miles .  225,214,000  ..  267,482,000  .. 

Average  Haul  —  Miles .  125.51  ..  124.01 

A.  Less  than  .005  per  cent  of  total. 


281 


RUTLAND  RAILROAD 

Tons  of  Revenue  Freight  Carried  by  Commodities 

1912  and  1922 


Products  of  Agriculture 

1.  Grain . 

2.  Flour  and  Meal . 

3.  Other  Mill  Products . 

4.  Hay,  Straw  and  Alfalfa  .... 

5.  Tobacco . 

6.  Cotton,  Cotton  Seed  &  Products 

except  Oil . 

7.  Fruit  and  Vegetables  _ . 

8.  Other  Products  of  Agriculture  . 

Products  of  Animals 

9.  Live  Stock  . 

10.  Dressed  Meats . 

11.  Other  Packing  House  Products  . 

12.  Poultry,  Game  and  Fish  .... 

13.  Wool . 

14.  Hides  and  Leather . 

15.  Other  Products  of  Animals  .  . 

Products  of  Mines 

16.  Anthracite  Coal . 

17.  Bituminous  Coal  . . 

18.  Coke . 

19.  Ores . 

20.  Stone,  Sand  and  Other  Like 

Articles . 

21.  Other  Products  of  Mines  .  .  . 

Products  of  Forests 

22.  Lumber . 

23.  Other  Products  of  Forests  .  . 

Manufactures 

24.  Petroleum  and  Other  Oils  .  .  . 

25.  Sugar,  Syrup,  Glucose  and 

Molasses . 

26.  Naval  Stores . 

27.  Iron,  Pig  and  Bloom . 

28.  Iron  and  Steel  Rails . 

29.  Other  Castings  and  Machinery  . 

30.  Bar  and  Sheet  Metal . 

31.  Cement,  Brick  and  Lime  .  .  . 

32.  Agricultural  Implements  .  .  . 

33.  Automobiles,  Trucks,  Wagons, 

Carriages,  Tools,  etc . 

34.  Wines,  Liquors  and  Beers  .  .  . 

35.  Household  Goods  and  Furniture. 

36.  All  Other  Commodities  .... 

Total  Tons  Carried . 

Revenue  Ton  Miles . 

Average  Haul — Miles . 

*  Year  ending  Dec.  31,  1912. 

A.  Less  than  .005  per  cent  of  total. 


1912* 

Per  cent 

1922  Percent 

Tons 

of  Total 

Tons  of  Total 

99,012 

4.15 

80,238 

4.39 

40,538 

1.70 

24,344 

1.33 

83,534 

3.50 

74,709 

4.09 

83,074 

3.49 

11,939 

.65 

591 

.02 

80 

A 

3,735 

.16 

3,883 

.21 

29,133 

1.22 

22,371 

1.22 

6,655 

.28 

4,502 

.25 

13,913 

.58 

9,956 

.55 

2,705 

.11 

1,175 

.06 

1,488 

.06 

1,931 

.11 

820 

.04 

11 

A 

2,050 

.09 

2,964 

.16 

3,777 

.16 

4,348 

.24 

21,983 

.92 

4,528 

.25 

243,085 

10.20 

230,352 

12.60 

374,773 

15.72 

296,063 

16.19 

8,773 

.37 

6,132 

.34 

2,628 

.11 

271 

.01 

178,876 

7.50 

184,331 

10.08 

18,704 

.78 

11,919 

.65 

123,670 

5.19 

93,795 

5.13 

439,286 

18.43 

108,235 

5.92 

10,815 

.45 

34,548 

1.89 

5,796 

.24 

19,577 

1.07 

243 

.01 

5 

A 

6,891 

.29 

3,191 

.17 

10,778 

.45 

6,734 

.37 

16,655 

.70 

10,706 

.59 

6,423 

.27 

9,927 

.54 

48,442 

2.03 

48,207 

2.64 

6,416 

.27 

5,057 

.28 

2,803 

.12 

20,939 

1.15 

3,872 

.16 

562 

.03 

6,545 

.28 

4,354 

.24 

475,482 

19.95 

486,335 

26.60 

2,383,964 

100.00 

1,828,219 

100.00 

261,143,000 

. .  201,641,000 

.  , 

109.54 

#  # 

110.29 

•  . 

282 


APPENDIX  D 

Comparative  Rates  to  Pacific  Coast 
(San  Francisco) 

(Rate  per  Hundred  Pounds) 


Commodity 

By  Water 
from  Boston 

By  Bail  From 
Boston  Pittsburgh  Detroit 

Chicago 

Cotton  Piece  Goods  . . . . 

_  n  r  CL 

$1.87*6 

$1.73 

$1.65 

$1.58 

'••m60{  LCL 

3.40*6 

3.18 

3.18 

2.95*6 

f  CL 

1.87*6 

1.73 

1.65 

1.58 

Dry  Goods . 

"  175  {  LCL 

3.40*6 

3.18 

3.18 

2.95*6 

f  CL 

2.40 

2.25 

2.18 

2.10 

Carpets  and  Rugs . 

-  -75i  LCL 

3.75 

3.45 

3.45 

3.21 

Paper . 

. .  .50  CL 

1.65 

1.40 

1.33 

1.25 

Hardware  and  Tools. . . . 

. . .  .70  LCL 

3.40*6 

3.18 

3.18 

2.95*6 

,  CL 

3.53 

2.75 

2.63 

2.50 

Pianos . 

•  •  ,75 1  LCL 

5.55 

5.40 

5.25 

5.10 

(  CL 

. .  1.50  |  LCL 

4.80 

4.65 

3.76 

3.69 

Boots  and  Shoes . 

5.16 

4.74 

4.74 

4.41 

(  CL 

3.44*6 

2.75* 

2.63 

2.50 

Automobile  Tires . 

•  •  -80 )  LCL 

5.55 

5.18 

5.18 

4.82 

CL  Carload  shipments. 

LCL  Less  than  carload  shipments. 

*  Pittsburgh  rate  group  includes  Akron,  Ohio. 


1 

1 

1 

1 

1 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

2 

3 

3 

3 

3 

3 

3 

3 


283 


Coastwise 

tt 

tt 

a 

a 

Foreign 

if 

a 

Coastwise 

It 

it 

li 

it 

tt 

u 

tt 

tt 

a 

a 

it 

a 

a 

a 

tt 

tt 

a 

a 

a 

a 

a 

a 

a 

a 

a 

a 

it 

a 

a 

tt 

tt 

u 

a 

it 

Foreign 

if 

it 

it 

tt 

tt 

Coastwise 


APPENDIX  E 

Arrivals  of  Foreign  and  Domestic  Vessels  at  Poet  of 

Boston  April  1-15, 1923 


Class 

Name 

Nationality 

From 

Nature  of  Cargo 

Steamer 

Glen  White  .... 

American 

Norfolk . 

Coal 

a 

Lake  Strymon.  .  . 

tt 

Jacksonville . 

General 

a 

Wilton . 

it 

New  York . 

General 

tt 

Lewis  K.  Thurlow  . 

tt 

Baltimore . 

Coal 

a 

City  of  Gloucester  . 

tt 

Gloucester . 

General 

San  Benito  .... 

British 

Port  Limon . 

Fruit  &  General 

Prince  George  .  . 

tt 

Yarmouth,  N.  S . 

General 

Thode  F agerlund  . 

Norwegian 

Buenos  Aires . 

Wool  &  General 

tt 

Seaconnet  .... 

American 

Norfolk . 

Coal 

a 

Quincy . 

tt 

tt 

Coal 

tt 

Gov.  Dingley  .  .  . 

it 

Portland,  Me . 

General 

Tug 

Norfolk . 

it 

Norfolk  (towing)  .... 

Barge 

Northern  No.  31  . 

it 

Norfolk  . 

Coal 

Tug 

D.  F.  McAllister  . 

it 

Elizabethport,  N.  J.  .  .  . 

Barge 

Easton . 

a 

tt  tt 

Coal 

it 

Coaldale  ..... 

tt 

li  tt 

Coal 

it 

Summit  Hill  .  .  . 

n 

it  tt 

Coal 

Tug 

Tamaqua  .... 

a 

Philadelphia . 

Coal 

Barge 

Cocalico . 

tt 

tt 

it 

Ontelaunce  .... 

n 

it 

Coal  (for  Gloucester) 

it 

Cohansey  .... 

a 

it 

Coal  (  “  “  ) 

Steamer 

Yorba  Linda  .  .  . 

a 

San  Pedro,  Calif . 

Oil 

it 

Cretan . 

tt 

Philadelphia . 

General 

it 

Nevisian . 

British 

“  (in  transit  to 

Liverpool) . 

Coal 

it 

Penobscot  .... 

American 

Norfolk  . 

Tug 

Nottingham  .  .  . 

tt 

Jersey  City . 

Coal 

Barge 

L  &  W  No.  6  .  .  . 

it 

tt  it 

L  &  W  No.  4  .  .  . 

tt 

it  it 

Coal  (for  Gloucester) 

tt 

Wilkesbarre  .  .  . 

it 

tt  il 

Coal 

Steamer 

Norfolk . 

tt 

Norfolk  . 

Coal 

Tug 

Paoli . 

tt 

Vineyard  Haven . 

Coal 

Barge 

Canisteo . 

it 

New  York . 

it 

Haverford  .... 

a 

tt  it 

Coal 

tt 

Strafford . 

tt 

it  it 

Coal  (for  Lynn) 

Steamer 

Grecian . 

tt 

Baltimore . 

General 

tt 

City  of  Columbus  . 

a 

Savannah  . 

General 

Tug 

Resolute . 

n 

Norfolk  (towing) 

Coal 

Barge 

Potomac . 

tt 

it 

il 

Nanticoke  .... 

tt 

it 

Coal 

Tug 

Chas.  P.  Greenough 

tt 

“  (towing) 

Coal  (for  Beverly) 

Barge 

Hattie . 

tt 

tt 

tt 

Rockland  .... 

tt 

Philadelphia . 

Coal 

it 

Northern  No.  11  . 

a 

it 

Coal 

Edge  Hill  .... 

American 

Rotterdam . 

General 

Connehatta  .  .  . 

il 

Manchester . 

General 

Hortensius  .... 

British 

Buenos  Aires . 

Wool  &  General 

Helesius . 

li 

tt  it 

General  (hides  &  skins' 

Naneric . 

it 

Calcutta . 

General 

Mayari . 

it 

Banes,  Cuba . 

Sugar 

Steamer 

City  of  Gloucester  . 

American 

Gloucester . 

General 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

3 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

4 

5 

5 

5 

5 

5 

5 

5 

5 

5 

5 

6 

6 

6 

6 

6 


284 


Arrivals  of  Foreign  and  Domestic  Vessels  (Continued) 


Class 

Name 

Nationality 

From 

Nature  of  Cargo 

Coastwise 

Steamer 

Everett . 

American 

Norfolk  . 

Coal 

il 

a 

Freeman . 

ii 

a 

Coal 

a 

a 

Artigas . 

ti 

Pacific  Ports . 

General 

a 

Tug 

Loraine  D . 

a 

Burlington,  N.  J.  (towing) . 

ii 

Barge 

Northern  No.  2  .  . 

a 

a  n 

Sand 

it 

Tug 

Mars . 

a 

Philadelphia  (towing) 

it 

Barge 

West  Moreland  .  . 

a 

ti 

Coal 

il 

Tug 

Perth  Amboy  .  .  . 

a 

Perth  Amboy  (towing) 

ii 

Barge 

702  . 

a 

il  il 

Coal 

a 

a 

706  . 

a 

a  a 

Coal 

ti 

a 

767  . 

ti 

a  a 

Coal  (for  Rockland,  Me.) 

ti 

Tug 

Puamico . 

a 

New  York  (towing) 

a 

Barge 

Sagamore  .... 

ti 

Edgewater,  N.  J . 

Coal 

a 

ii 

Esther  Hughes  .  . 

a 

Port  Reading,  N.  J.  .  .  . 

Coal 

a 

Schooner 

Grand  Turk  .  .  . 

it 

Jacksonville . 

Lumber 

il 

it 

Mabel  A.  Frye  .  . 

a 

ii 

Lumber 

it 

Steamer 

Newton . 

a 

Norfolk  . 

Coal 

a 

ii 

Delaware  .... 

a 

New  York . 

General 

a 

il 

Deepwater  .... 

a 

Norfolk  . 

Coal 

Foreign 

City  of  Dunkirk 

British 

Shanghai,  etc . 

General  &  Rubber 

il 

West  Cohas  .  .  . 

American 

Liverpool  . 

General 

il 

Deuel . 

ii 

Hamburg . 

General 

it 

Agwimars  .  .  . 

il 

Port  Lobos . 

Oil 

it 

West  Helix  .... 

ii 

Rotterdam . 

General 

it 

Boswell . 

British 

Santa  Fe . 

Wool  &  Hides 

Coastwise 

il 

City  of  Gloucester  . 

American 

Gloucester . 

General 

It 

il 

Calvin  Austin  .  . 

a 

New  York . 

General 

il 

il 

Evelyn  . 

a 

Porto  Rico . 

Sugar 

it 

ti 

Gov.  Dingley  .  .  . 

a 

Portland . 

General 

il 

Tug 

Savage  . 

a 

Philadelphia  (towing) 

it 

Barge 

No.  19 . 

a 

a 

Coal 

it 

ii 

No.  20 . 

a 

ii 

Coal 

it 

ii 

No.  25 . 

a 

a 

Coal 

it 

Steamer 

Cornish . 

a 

New  York . 

General 

ii 

ii 

Quantico . 

a 

Philadelphia . 

General 

a 

Tug 

Col.  J.  F.  Gaynor  . 

it 

New  York  (towing) 

a 

Barge 

Tamaqua  .... 

ti 

il  ii 

Coal 

a 

a 

Rahn . 

a 

il  ii 

Coal 

a 

a 

Nesquehoning  .  . 

it 

il  it 

Coal 

Foreign 

Prince  George  .  . 

British 

Yarmouth . 

General 

ti 

Elisha  Walker  .  . 

American 

Tampico . 

Oil 

a 

Commodore  Rollins 

Norwegian 

Santa  Marta . 

Bananas 

a 

Gardenia . 

British 

Port  Talbot . 

Coal 

Coastwise 

Steamer 

City  of  Gloucester . 

American 

Gloucester . 

General 

ii 

a 

Belfast . 

ii 

New  York . 

General 

ii 

a 

Lewis  Luckenbach 

il 

Pacific  Ports . 

General 

it 

a 

Merrimack  .... 

a 

Norfolk  . 

General 

il 

Tug 

J  uno . 

a 

Sandwich  (towing) 

fl 

Barge 

Hughes  Brothers  . 

a 

Guttenberg,  N.  J . 

Coal 

Foreign 

Canadian  Challenger  British 

Australian  Ports, 

via  New  York . 

Wool  &  Hides 

it 

W.  L.  Steed.  .  .  . 

American 

Tampico . 

Oil 

il 

Winifredian  .  .  . 

British 

Liverpool . 

General 

il 

Montana . 

American 

Vancouver,  B.  C . 

Lumber 

ii 

City  of  Cambridge 

British 

Calcutta . 

General 

6 

6 

6 

6 

6 

6 

6 

6 

6 

6 

6 

6 

6 

6 

6 

6 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

7 

8 

8 

8 

8 

8 

8 

8 

8 

8 

9 

9 

9 

9 

9 


285 


Arrivals  of  Foreign  and  Domestic  Vessels  (Continued) 


Class 

Name 

Nationality 

From 

Nature  of  Cargo 

Coastwise 

Steamer 

City  of  Gloucester  . 

American 

Gloucester . 

General 

tt 

ft 

M  unmotor  .  .  .  . 

a 

Norfolk  . 

Coal 

tt 

tt 

Indian . 

a 

it 

General 

tt 

tt 

Gov.  Dingley  .  .  . 

tt 

Portland . 

General 

tt 

Tug 

Carlisle . 

tt 

Philadelphia  (towing) 

if 

Barge 

Salem . 

tt 

tt 

Coal 

tt 

tt 

Ephrata . 

tt 

tt 

Coal  (for  Portland) 

tt 

tt 

Neshaminy  .... 

tt 

tt 

Coal  “ 

tt 

Steamer 

Dorchester  .... 

tt 

ft 

General 

it 

tt 

City  of  Rome  .  .  . 

tt 

Savannah  . 

General 

tt 

tt 

Hampden . 

tt 

Norfolk  . 

Coal 

tt 

a 

Calvin  Austin  .  . 

it 

New  York . 

General 

a 

it 

Wilton . 

tt 

tt  tt 

General 

tt 

it 

Walter  D.  Noyes  . 

tt 

Norfolk  . 

Coal 

tt 

Tug 

Mercury . 

tt 

Vineyard  Haven  (towing) 

tt 

Barge 

Brooklyn . 

tt 

New  York . 

Coal 

Foreign 

Port  Said,  Maru  . 

Japanese 

Italian  Ports, 

via  New  York . 

Olive  Oil,  Hides,  etc. 

(C 

Herbert  G.  Wylie  . 

American 

Tampico . 

Oil 

it 

Wascana . 

Norwegian 

Louisburg,  C.  B . 

Coal 

tt 

Thistlemore  .  .  . 

British 

Liverpool  . 

General 

it 

Levisa . 

American 

Preston,  Cuba . 

Sugar 

Coastwise 

Steamer 

City  of  Gloucester  . 

tt 

Gloucester . 

General 

tt 

tt 

Bristol . 

tt 

Norfolk  . 

Coal 

tt 

tt 

Belfast . 

tt 

New  York . 

General 

tt 

tt 

Ontario . 

tt 

Baltimore . 

General 

tt 

tt 

Massasoit  .... 

tt 

Jonesport,  etc . 

General 

tt 

Tug 

Col.  J.  F.  Gaynor  . 

tt 

Sandwich  (towing) 

tt 

Barge 

No.  5 . 

tt 

Philadelphia . 

Coal 

tt 

Tug 

Triton . 

tt 

New  York  (towing) 

it 

Barge 

Cohocton  .... 

tt 

tt  tt 

Coal  (for  Clark  Island) 

tt 

tt 

Shickskinny.  .  .  . 

tt 

tt  it 

Coal 

tt 

Tug 

Harold  . 

tt 

“  “  (towing) 

ft 

Barge 

Iron  Queen  .... 

tt 

tt  tt 

Coal  Tar 

tt 

Steamer 

Carisco . 

tt 

Port  Ivory,  S.  I . 

Soap  Stock 

tt 

Tug 

International  .  .  . 

tt 

Philadelphia  (towing) 

it 

Barge 

Langhorne  .... 

It 

tt 

Coal 

tt 

tt 

Silver  Brook  .  .  . 

tt 

tt 

Coal  (for  Plymouth) 

it 

it 

Oak  Hill . 

it 

It 

Coal 

tt 

Steamer 

Lake  Fannin  .  .  . 

tt 

Jacksonville . 

General 

tt 

Schooner 

Henrietta  Simmons 

tt 

Nantucket . 

Junk 

tt 

Steamer 

Delaware  .... 

it 

New  York . 

General 

tt 

tt 

Glen  White  .  .  . 

tt 

Norfolk  . 

Coal 

ft 

it 

Cornish . 

tt 

New  York . 

General 

tt 

tt 

Gov.  Dingley  .  .  . 

tt 

Portland . 

General 

tt 

tt 

Calvin  Austin  .  . 

tt 

New  York . 

General 

tt 

it 

Steel  Seafarer  .  .  . 

tt 

Pacific  Ports  . 

General 

tt 

Schooner 

Spindrift . 

tt 

Georgetown,  S.  C . 

Lumber 

it 

Tug 

Battleboro  .  .  . 

tt 

Norfolk  (towing) 

tt 

Barge 

Bango . 

tt 

It 

Coal 

it 

tt 

Cohasset . 

tt 

Coal 

Foreign 

Columbia  .... 

British 

Glasgow,  Scot . 

General  for  New  York 

tt 

Ningchow  .... 

tt 

Shanghai,  etc . 

General 

it 

Verentia . 

tt 

London  . 

General 

tt 

Vincenzo  Florio  .  . 

Italian 

Leghorn  . 

General 

tt 

Stanmore  .  .  .  . 

British 

Glasgow,  Scot . 

General 

286 


Arrivals  of  Foreign  and  Domestic  Vessels  (Continued) 

Date  Class  Name  Nationality  From  Nature  of  Cargo 

April  9  Foreign  San  Bruno  ....  British  Port  Limon . Bananas  &  Coffee 

9  “  Prince  George  .  .  “  Yarmouth,  N.  S . General 

9  “  Geo.  G.  Henry  .  .  American  Tampico . Oil 

9  “  Australind  ....  British  Australia . Wool  &  Casein 

9  “  Scythian .  “  London . General 

9  Coastwise  Steamer  City  of  Gloucester .  American  Gloucester . General 

9  “  “  Arlington  ....  “  Norfolk  . Coal 

9  “  “  Belfast  .  “  New  York . General 

9  “  “  Cretan .  “  Philadelphia . General 

9  “  “  J.  H.  Devereaux  .  “  “  . Coal 

9  “  “  Middlesex  ....  “  Norfolk  . Coal 

9  “  “  Nacoochee  ....  “  Savannah . General 

9  “  “  Seaconnet  ....  “  Norfolk . Coal 

9  “  Tug  Gettysburg  ....  “  Philadelphia  (towing) 

9  “  Barge  Yardley .  “  “  . Coal  (for  Lynn) 

9  “  Tug  Fame  .......  “  Norfolk  (towing) 

9  “  Barge  Beattie .  “  “  . Coal 

9  "  “  Irene .  “  “  . Coal  (for  Lynn) 

9  “  “  Biwabik .  “  “  . Coal  (for  Beverly) 

9  “  Tug  Murrell .  “  “  (towing) 

9  •'  Barge  Flora .  “  “  . Coal 

9  “  “  Edith .  “  “  . Coal 

9  “  “  Annie .  “  “  . Coal  (for  Beverly) 

9  “  Tug  Lehigh .  “  Perth  Amboy  (towing) 

9  “  Barge  No.  781  ....  .  “  “  “  . Coal 

9  “  Schooner  W.  H.  Harriman  .  “  St.  Andrews  Bay  ....  Railroad  Ties 

9  “  Barge  No.  784  .  “  Perth  Amboy . Coal 

9  "  “  No.  785  .  “  “  “  . Coal 

9  “  Steamer  Grecian .  “  Baltimore  &  Norfolk  .  .  .  General 

9  “  “  Swiftsure  ....  “  Curacao  via  F.  It . Oil 

10  Foreign  Laertes . Dutch  Padang . General 

10  Coastwise  Steamer  Calvin  Austin  .  .  American  New  York . General 

10  “  “  City  of  Gloucester  .  “  Gloucester . General 

10  “  “  Lake  Gilboa  ...  “  Jacksonville  &  Charleston  .  General 

10  “  “  Long  Beach  ...  “  Norfolk . Coal 

10  “  "  Suffolk .  “  “  . Coal 

10  “  Barge  Socony  No.  G2  .  .  “  New  York . Oil 

10  “  Tug  Roger  Williams  .  .  “  “  “  (towing) 

10  “  Barge  Marion .  “  “  “  . Coal 

10  “  “  Edgewater  ....  “  “  “  . Coal 

10  “  Schooner  James  C.  Hamlen  .  “  Port  St.  Joe . Lumber 

10  “  Tug  Boston .  “  Norfolk  (towing) 

10  “  Barge  Northern  No.  14  .  “  “  . Coal 

10  “  “  Northern  No.  4  .  .  “  “  . Coal  (for  Portland) 

10  “  Tug  T.  J.  Hooper  ...  “  “  (towing) 

10  “  Barge  Eastern .  “  “  . Coal 

10  “  “  Seth  Linthicum  .  .  “  “  . Coal  (for  Lynn) 

10  “  “  J.  J.  Hock  ....  “  «  . Coal  “ 

10  “  Steamer  Lake  Elsmere  ...  “  Jacksonville . General 

10  Foreign  Azov . British  St.  John,  N.  B . None 

11  Foreign  Steel  Seafarer  .  .  American  . Lumber  &  Hides 

11  “  Eudunda . British  Melbourne . Wool  &  Skins 

11  “  Dania . Danish  Copenhagen*. . General 

11  Coastwise  “  City  of  Gloucester .  American  Gloucester . General 

11  “  “  Anahuac .  “  Fall  River . Oil 

11  “  “  Belfast .  “  New  York . General 

11  “  “  Corsica .  “  Norfolk . Coal 


287 


Arrivals  of  Foreign  and  Domestic  Vessels  (Continued) 


Date 

Class 

Name 

Nationality 

From 

Nature  of  Cargo 

April  11 

Coastwise 

Steamer 

Everett . 

American 

Norfolk . 

Coal 

11 

il 

il 

Peter  H.  Crowell  . 

U 

it 

.  Coal 

11 

it 

ti 

Wilton . 

(( 

New  York . 

.  General 

11 

a 

it 

Gov.  Dingley  .  .  . 

it 

Portland . 

.  General 

11 

a 

il 

Merrimack  .... 

ii 

Philadelphia . 

General 

11 

it 

Quantico . 

u 

Norfolk . 

.  General 

11 

a 

Tug 

Cheektowago  .  .  . 

it 

Perth  Amboy  (towing) 

11 

Barge 

No.  701 . 

il 

a  u 

Coal 

11 

it 

a 

No.  786  . 

a 

a  a 

.  Coal 

11 

a 

a 

No.  783  . 

a 

a  a 

.  Coal  (for  Lynn) 

11 

il 

Tug 

Dunmore  .... 

a 

Norfolk  (towing) 

11 

a 

Barge 

Garrett . 

a 

il 

.  Coal 

11 

il 

Tug 

Honey  Brook  .  .  . 

a 

New  York  (towing) 

11 

il 

Barge 

I  &  W  B  C  C  No.  8 

a 

it  u 

.  Coal  (for  Salem) 

11 

a 

U 

I  &  W  B  C  C  No.  9 

n 

a  a 

.  Coal  (for  Lynn) 

11 

a 

il 

I  &  W  B  C  C  No.  11 

a 

a  it 

.  Coal 

11 

a 

Tug 

Pallas . 

1C 

Sandwich  (towing) 

11 

a 

Barge 

Geo.  J.  Hughes  .  . 

u 

New  York . 

.  Coal 

11 

a 

Steamer 

Coastwise  .... 

<i 

Norfolk  . 

.  Coal 

11 

a 

il 

H.  II.  Brown  .  .  . 

a 

il 

Coal 

12 

Foreign 

Prince  George  .  . 

British 

Yarmouth,  N.  S . 

.  General 

12 

il 

Oritani . 

il 

Santa  Marta . 

.  Bananas 

12 

il 

Beemsterdyk  .  .  . 

Dutch 

Rotterdam . 

.  General 

12 

Coastwise 

Steamer 

Calvin  Austin  .  . 

American 

New  York . 

.  General 

12 

(( 

il 

City  of  Gloucester  . 

a 

Gloucester . 

.  General 

12 

il 

a 

Glendaurel  .... 

a 

Norfolk . 

.  Coal 

12 

il 

tt 

Melrose . 

a 

a 

.  Coal 

12 

tt 

Tug 

Tamaqua  .... 

a 

Philadelphia  (towing) 

12 

it 

Barge 

Betjayres  .... 

a 

il 

.  For  Lynn 

12 

a 

U 

Molino . 

a 

a 

.  For  Portland 

12 

tt 

Schooner 

Bright . 

a 

Norfolk . 

.  Coal 

12 

it 

Steamer 

Deepwater  .... 

a 

il 

.  Coal 

12 

a 

il 

Sewalls  Point  .  .  . 

a 

il 

.  Coal 

12 

a 

Tug 

Valley  Forge  .  .  . 

a 

Philadelphia  (towing) 

12 

a 

Barge 

Macungie  .... 

a 

il 

.  Coal 

12 

a 

il 

Tohickon  \  .  .  . 

a 

it 

.  Coal 

12 

a 

Schooner 

Geo.  R.  Bradford  . 

a 

Stonington . 

.  Stone 

13 

Foreign 

Bowes  Castle  .  .  . 

British 

Shanghai . 

.  General 

13 

H 

West  Quechee  .  . 

American 

Liverpool  . 

General 

13 

it 

City  of  Madras  .  . 

British 

Alexandria . 

.  Cotton  &  General 

13 

tt 

West  Kebar . 

American 

Hamburg . 

.  General 

13 

il 

West  Isleta  .... 

it 

Manchester . 

.  General 

13 

tt 

Manaqui . 

British 

Preston . 

.  Sugar 

13 

Coastwise 

Steamer 

City  of  Gloucester  . 

American 

Gloucester . 

.  General 

13 

(l 

il 

Robin  Goodfellow  . 

a 

Pacific  Coast  ..... 

.  General 

13 

l( 

a 

Belfast . 

a 

New  York . 

.  General 

13 

(i 

a 

Camden . 

a 

Bangor . 

.  General 

13 

it 

a 

Blue  Triangle  .  .  . 

a 

Pacific  Ports . 

.  General 

13 

(C 

a 

Gov.  Dingley  .  .  . 

a 

Portland . 

.  General 

13 

it 

a 

J.  M.  Guffey  .  .  . 

a 

Port  Arthur . 

.  Oil 

13 

it 

tt 

Moldegaard  .  .  . 

a 

Norfolk . 

.  Coal 

13 

It 

it 

Dorchester  .... 

a 

Baltimore . 

.  General 

13 

a 

a 

Ontario . 

a 

Philadelphia . 

.  General 

13 

a 

Schooner 

Mary  Langdon  .  . 

a 

Rockport . 

Lime 

13 

a 

Tug 

Lenape  . 

a 

Philadelphia  (towing) 

13 

a 

Barge 

Bast . 

a 

.  Coal 

•/ 


13 

13 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

14 

15 

15 

15 

15 

15 

15 

15 

15 

15 

15 


288 


Arrivals  of  Foreign-  and  Domestic  Vessels  (Continued) 


Class 

Name 

Nationality 

From 

Nature  of  Cargo 

Coastwise 

Barge 

Wiconisco  .... 

American 

Philadelphia  .... 

.  Coal 

ft 

a 

Leesport . 

it 

ll 

.  Coal 

Foreign 

Chickasaw  .... 

it 

London  . 

It 

Merton  Hall  .  .  . 

British 

Rosario . 

.  Wool  &  Hides 

it 

Abbie  S.  Walker  . 

American 

Port  Midway,  N.  S.  . 

it 

Liberty  Glo  .  .  . 

ll 

Bahai . 

it 

Hambleton  Range  . 

British 

Grangemouth  .... 

.  Coal 

Coastwise 

Steamer 

Calvin  Austin  .  . 

American 

New  York . 

.  General 

it 

a 

City  of  Gloucester . 

it 

Gloucester . 

.  General 

it 

it 

City  of  Columbus  . 

a 

Savannah  . 

it 

it 

Glen  White .... 

it 

Norfolk . 

.  Coal 

it 

it 

Hampden  .... 

a 

ll 

.  Coal 

it 

tt 

Stephen  R.  Jones  . 

a 

It 

.  Coal 

tt 

it 

Transportation  .  . 

a 

ll 

Coal 

it 

tt 

Cornish . 

it 

New  York . 

General 

it 

tt 

Newton . 

a 

Baltimore . 

.  Coal 

ti 

Tug 

Plymouth  .... 

a 

New  York  (towing) 

a 

Barge 

L  &  W  B  C  No.  1  . 

a 

ll  ll 

a 

tt 

L  &  W  B  C  No.  5  . 

a 

ll  ll 

.  Coal 

tt 

a 

L  &  W  B  C  No.  7  . 

u 

It  It 

.  Coal 

tt 

Tug 

Bathgate . 

u 

Norfolk  (towing) 

it 

Barge 

Chenango  .... 

u 

It 

Coal 

a 

it 

Cutler . 

ii 

It 

.  Coal 

a 

Tug 

Piedmont  .... 

n 

Philadelphia  (towing) 

tt 

Barge 

Number  14  ...  . 

it 

ll 

.  Coal 

a 

it 

Number  15  ...  . 

it 

It 

.  Coal 

tt 

Tug 

D.  F.  McAllister  . 

u 

Elizabethport  (towing) 

a 

Barge 

Hauto . 

u 

ll 

.  Coal  (for  Portland) 

it 

it 

Greenwood  .... 

it 

It 

.  Coal 

Foreign 

Carmania  .... 

British 

Liverpool . 

.  Passengers  only 

Coastwise 

Steamer 

Wilton . 

American 

New  York . 

General 

it 

it 

Belfast . 

it 

New  York . 

it 

it 

Camden . 

ll 

Bangor . 

.  General 

a 

it 

Gov.  Dingley  .  .  . 

ll 

Portland . 

.  General 

a 

tt 

M  unmotor  .... 

ll 

Norfolk . 

.  Coal 

it 

u 

Selwyn  Eddy  .  .  . 

ll 

It 

.  Coal 

a 

it 

Florida . 

ll 

“  (towing)  .  . 

.  Coal 

it 

Barge 

W.  B.  Fancher  .  . 

ll 

ll 

.  Coal 

tt 

It 

John  Blight  .  .  . 

It 

It 

.  Coal 

289 


APPENDIX  F 


New  England  Coal  Receipts 
1916-1922  — Net  Tons 


Anthracite  and  Bituminous 


Calendar 

Tide  and 

Per  Cent  of  Total 

Year 

Rail 

Tide 

Rail 

Tide 

Rail 

1916 

34,837,000 

19,421,000 

15,416,000 

56 

44 

1917 

35,184,000 

17,114,000 

18,070,000 

49 

51 

1918 

40,792,000 

20,174,000 

20,618,000 

49 

51 

1919 

28,760,000 

11,837,000 

16,923,000 

41 

59 

1920 

33,689,000 

13,732,000 

19,957,000 

41 

59 

1921 

28,562,000 

12,509,000 

16,053,000 

44 

56 

1922 

25,279,000 

15,056,000 

10,223,000 

60 

40 

Anthracite 

1916 

10,715,000 

5,228,000 

5,487,000 

49 

51 

1917 

11,680,000 

4,421,000 

7,259,000 

38 

62 

1918 

13,621,000 

4,117,000 

9,504,000 

30 

70 

1919 

10,578,000 

3,310,000 

7,268,000 

31 

69 

1920 

11,255,000 

3,521,000 

7,734,000 

31 

69 

1921 

11,374,000 

3,695,000 

7,679,000 

32 

68 

1922 

6,471,000 

2,060,000 

4,411,000 

32 

68 

Bituminous 

1916 

24,122,000 

14,193,000 

9,929,000 

59 

41 

1917 

23,504,000 

12,693,000 

10,811,000 

54 

46 

1918 

27,171,000 

16,057,000 

11,114,000 

59 

41 

1919 

18,182,000 

8,527,000 

9,655,000 

47 

53 

1920 

22,434,000 

10,211,000 

12,223,000 

46 

54 

1921 

17,188,000 

8,814,000 

8,374,000 

51 

49 

1922 

18,808,000 

12,996,000 

5,812,000 

69 

31 

290 


APPENDIX  G 

Increase  in  Per  Diem  Rates  1902  to  1922 

Prior  to  July  1902  the  rent  paid  by  one  railroad  to  another 
for  the  use  of  its  cars  was  based  upon  the  actual  mileage 
made  by  each  car  at  the  rate  of  .6  of  a  cent  per  mile  so  that 
the  New  England  railroads  in  common  with  all  other  rail¬ 
roads  paid  only  each  day  for  the  miles  actually  run  on  their 
rails  each  day  by  each  car.  Under  this  system  a  foreign  car, 
if  it  waited  a  week  to  be  moved,  would  cost  nothing.  But  be¬ 
ginning  July  1,  1902,  the  present  system  was  inaugurated 
on  the  American  railroads  of  charging  for  freight  cars  not 
on  the  basis  of  miles  moved  but  instead  a  daily  charge  of 
20^  for  each  car  out  of  the  possession  of  the  owning  road. 
This  per  diem  charge  has  gradually  risen  and  since  No¬ 
vember  1,  1920,  has  been  at  the  rate  of  one  dollar  per  car 
day. 


Per  Diem  Rates — 1902  to  1922 


July  1902  to  July 

1906 

20^  penalty 

80^ 

over 

30  days 

July  1906 

(( 

July 

1907 

25  . 

75 

U 

U 

u 

July  1907 

U 

March  1,  1908 

50  No  penalty 

(( 

(C 

u 

March  1,  1908 

(C 

Feb. 

1910 

25  . 

U 

(C 

(( 

Feb.  1910 

u 

July 

1910 

30  . 

(C 

a 

u 

July  1910 

(C 

Feb. 

28,  1911 

35  . 

(( 

C( 

(C 

Feb.  28,  1911 

u 

July 

1,  1911 

30  . 

(t 

u 

(( 

July  1,  1911 

a 

Feb. 

28,  1912 

35  . 

u 

(C 

u 

March  1,  1912 

u 

July 

31,  1912 

30  . 

u 

(( 

(C 

Aug.  1,  1912 

u 

Dec. 

31,  1912 

35  . 

u 

(C 

u 

Jan.  1,  1913 

u 

Dec. 

14,  1916 

45  . 

(C 

u 

(C 

Dec.  14,  1916 

(( 

April 

1,  1917 

75  . 

(( 

u 

u 

April  1,  1917 

(C 

March  1,  1920 

60  . 

u 

u 

(( 

March  1,  1920 

u 

Nov. 

1,  1920 

90  . 

(( 

(( 

u 

Nov.  1,  1920 

u 

date 

1.00  . 

u 

a 

u 

291 

This  daily  charge  has  thus  been  raised  because  at  the 
lower  figures  it  was  found  that  some  roads  still  failed  to 
provide  their  fair  quota  of  cars,  and  also  because  the  cost 
of  freight  cars  has  been  rising  due  to  bigger  cars  and  the 
increase  in  wages  and  cost  of  material.  Today  at  the  dollar 
rate  the  owning  company  after  paying  the  expense  of 
upkeep  and  depreciation  gets  little  more,  if  any  at  all, 
than  mere  interest  upon  the  capital  invested  in  the  car. 
It  is  also  true  that  during  periods  of  business  depression 
cars  are  thrown  back  on  the  owning  line  and  many  unem¬ 
ployed  cars  remain  in  storage  on  the  home  line  and  earn 
nothing. 

This  change,  however,  while  it  undoubtedly  was  a  good 
thing  for  the  country  as  a  whole  worked  hardship  on  the 
New  England  lines,  which  at  best  are  lines  with  shorter 
hauls  and  a  higher  percentage  of  terminals  and  junction 
points,  subjecting  the  cars  to  more  delay,  decreasing  the 
mileage  earnings  and  increasing  the  per  diem  charges  to 
be  deducted  therefrom. 

We  wish,  however,  to  emphasize  strongly  that  this  $1 
per  diem  charge,  which  is  constantly  eating  into  the  net 
earnings  to  be  derived  from  hauling  a  car,  introduced  an 
important  new  element  which  must  be  given  much  consider¬ 
ation  in  the  operating  policies  of  all  railroads.  Over  and 
over  again  and  for  thousands  of  cars  in  New  England  this 
per  diem  charge  due  to  slow  movement  is  eating  up  the  net 
profit  above  the  actual  operating  expense  of  hauling  the 
car  and  in  fact  undoubtedly  often  goes  further  and  in 
many  cases  reaches  such  an  accumulated  out  of  pocket 
charge  that  the  railroad  would  be  better  off  if  the  car  had 
not  come  onto  its  system  at  all. 

Under  the  old  system  of  the  mileage  charge  a  railroad 
could  let  a  foreign  car  stand  idle  on  its  rails  just  as  long 
as  it  chose  and  as  many  of  them  as  it  pleased  provided  the 
foreign  cars  did  not  actually  embarrass  the  movement  of 
traffic.  Cars  could  wait  at  a  junction  or  terminal  and  be 
allowed  slowly  to  accumulate  for  a  run  to  some  particular 


292 


point  until  a  full  train  load  had  been  made  up.  This  saved 
operating  expenses  by  finally  making  it  possible  for  the 
engine  and  the  train  crew  to  pull  a  full  load  to  destination 
without  stop. 

Today  a  full  train  load  is  as  desirable  as  it  always  has  been 
and  a  railroad  which  receives  from  its  western  connecting 
line  a  full  train  for  a  straight  line  haul,  and  especially  if 
it  be  a  long  line  haul,  and  delivers  the  full  train  to  an  east¬ 
ern  connection  is  in  clover.  It  has  no  classification  delays 
and  the  maximum  ton  mile  earnings  with  the  minimum  car 
per  diems  to  be  deducted.  One  of  the  disadvantages  of  the 
New  England  roads  is  that  as  primarily  terminal  roads 
they  have  relatively  little  of  this  through  “  beyond  to 
beyond  ”  service. 

It  may  be  that  the  operating  policies  of  some  of  our  New 
England  railroads  are  still  too  much  based  on  the 
“mileage”  period  and  have  not  been  sufficiently  read¬ 
justed  to  meet  the  new  conditions  presented  by  the  present 
‘  ‘  per  diem  ’  ’  era. 


293 


APPENDIX  H 

Revenue  Ton  Miles  and  Passenger  Miles 
New  Haven  Railroad 
1903-1922 


z 

o 


£ 

4000 

3800 

3600 

3400 

3200 

3000 

2800 

2600 

2400 

2200 

2000 

1800 

1600 

1400 

1200 

1000 

800 

600 

400 

200 

0 


295 


APPENDIX  I 


NEW  HAVEN  RAILROAD 

Volume  of  Freight  and  Passenger  Traffic,  Revenues  and  Rates 

1912-1922 


- - - 

Revenue 

Ton  Miles 

Freight 

Revenue 

Average 

Revenue  Per 
Ton  Mile 
(Cents) 

Passenger 

Miles 

Passenger 

Revenue 

Average 

Revenue  Per 
s  Passenger 
f  Mile  (Cents) 

Year  ended  June  30,  1912 

1913 

1914 

1915 

1916 

Year  ended  Dee.  31,  1917 

1918 

1919 

1920 

1921 

1922 

2,581,740,000 

2,792,244,000 

2,676,369,000 

2,595,800,000 

2,922,051,000 

3,310,313,000 

3,691,973,000 

3,604,006,000 

3,376,976,000 

2,974,494,000 

3,020,410,000 

$35,088,775 

37,238,633 

35,598,938 

34,599,720 

41,667,878 

45,282,042 

56,216,029 

55,392,569 

62,505,722 

61,364,817 

66,157,968 

1.359(4 

1.333 

1.330 

1.333 

1.426 

1.368 

1.519 

1.537 

1.851 

2.063 

2.190 

1,573,146,000 

1,621,192,000 

1,620,005,000 

1,496,955,000 

1,589,142,000 

1,829,317,000 

1,843,634,000 

2,035,682,000 

2,165,185,000 

1,900,403,000 

1,S57,933,000 

$27,151,702 

28,256,503 

27,861,849 

27,463,129 

30,051,908 

34,783,076 

39,676,864 

45,074,033 

52,590,628 

51,222,199 

49,443,460 

1.726)! 

1.743 

1.720 

1.835 

1.891 

1.902 

2.152 

2.214 

2.429 

2.695 

2.661 

Increase  1922  over  1912 
Amount 

Per  cent 

438,670,000 

17.0% 

31,069,193 

88.5% 

0.831 

61.1% 

284,787,000 

18.1% 

22,291,758 

82.1% 

0.935 

54.2% 

Eastern  District 

(  1Q22 

(Class  1  Roads)  j  ^9^2 
Increase  —  Amount 

Per  cent 

151,389,805,000 

133,425,498,000 

17,964,307,000 

13.5% 

1,773,544,662 

852,060,603 

921,484,059 

108.1% 

1.172 

0.638 

0.534 

83.7% 

18,104,009,000 

15,401,754,000 

2,702,255,000 

17.5% 

514,462,146 

274,724,616 

239,737,530 

87.3% 

2.841 

1.783 

1.058 

59.3% 

United  States 

(Class  1  Roads)  j  1912 
Increase  —  Amount 

Per  cent 

339,730,198,000 

259,981,628,000 

79,748,570,000 

30.7% 

3,994,521,645 

1,897,692,838 

2,096,828,807 

110.5% 

1.176 

0.730 

0.446 

61.1% 

35,507,222,000 

32,316,263,000 

3,180,959,000 

9.9% 

1,075,262,223 

639,818,627 

435,443,596 

68.1% 

3.028 

1.980 

1.048 

52.9% 

' 


. 


■ 


‘ 


297 


APPENDIX  J 

Revenue  Ton  Miles  and  Passenger  Mtt.es 
Boston  &  Maine  Railroad 
1903-1922 


I  ' 


299 


APPENDIX  K 

BOSTON  &  MAINE  RAILROAD 

Volume  of  Freight  and  Passenger  Traffic,  Revenues  and  Rates 

1912-1922 


Year  ended  June  30,  1912 

1913 

1914 

1915 

1916 

Year  ended  Dec.  31,  1917 

1918 

1919 

1920 

1921 

1922 

Increase  1922  over  1912 
Amount 
Per  cent 

Eastern  District 
(Class  1  Roads)  1922 

1912 

Increase  —  Amount 
Per  cent 

United  States 
(Class  1  Roads)  1922 

1912 

Increase  —  Amount 
Per  cent 


Revenue 

Tons 

Handled 


23,694,987 

25,473,568 

24,752,884 

22,678,480 

26,497,039 

28,457,813 

30,109,986 

26,515,893 

27,186,674 

20,060,610 

21,295,716 


-2,899,271 

-10.1% 


Revenue 

Ton 

Miles 


2,460,991,000 

2,721,197,000 

2,635,139,000 

2,416,458,000 

2,961,599,000 

3,341,899,000 

3,612,615,000 

3,293,288,000 

3,705,528,000 

2,673,769,000 

2,689,915,000 


228,924,000 

9.3% 


151,389,805,000 

133,425,498,000 

17,964,307,000 

13.5% 


339,730, 19S, 000 
259,981,628,000 
79,748,570,000 
30.7% 


Freight 

Revenue 


$26,811,513 

28,692,689 

27,866,098 

27,042,879 

31,963,489 

35,119,306 

43,085,382 

43,303,091 

53,306,738 

47,660,693 

48,264,235 


21,452,722 

80.0% 


1,773,544,662 

852,060,603 

921,484,059 

108.1% 


3,994,521,645 

1,897,692,838 

2,096,828,807 

110.5% 


Average 
Revenue 
Per  Ton 
Mile 
(Cents) 


1.089jf 

1.054 

1.057 

1.119 

1.079 

1.051 

1.193 

1.315 

1.439 

1.783 

1.794 


0.705 

64.7% 


1.172 

0.638 

0.534 

83.7% 


1.176 

0.730 

0.446 

61.1% 


Passengers 

Carried 


49,284,076 

49,918,103 

47,032,535 

43,472,158 

42,518,745 

47,564,736 

44,660,430 

50,804,904 

54,933,009 

47,683,233 

46,275,630 


-8,008,446 

-6.1% 


Passengers 

Miles 

Passenger 

Revenue 

Average 

Revenue 

Per 

Passenger 

Mile 

(Cents) 

880,742,000 

$15,693,675 

1.782?' 

904,059,000 

16,049,174 

1.775 

896,081,000 

15,851,615 

1.769 

849,949,000 

15,502,197 

1.824 

798,695,000 

14,781,722 

1.851 

926,966,000 

17,558,069 

1.894 

882,382,000 

19,039,025 

2.158 

976,112,000 

21,798,847 

2.233 

1,014,735,000 

24,321,S38 

2.397 

876,113,000 

23,274,713 

2.657 

847,361,000 

22,242,206 

2.625 

-33,881,000 

6,548,531 

0.843 

-3.8% 

41.7% 

47.3% 

18,104,009,000 

514,462,146 

2.841 

15,401,754,000 

274,724,616 

1.783 

2,702,255,000 

239,737,530 

1.058 

17.5% 

87.3% 

59.3% 

35,507,222,000 

1,075,262,223 

3.028 

32,316,263,000 

639,818,627 

1.980 

3,180,959,000 

435,443,596 

1.048 

9.9% 

68.1% 

52.9% 

-  Italics  indicate  Decrease 


Note.  These  statistics  do  not  include  the  figures  for  the  following  small  lines  in  the  Boston 
&  Maine  system  for  which  complete  data  was  not  available  for  the  entire  period.  The  reve¬ 
nue  ton  miles  of  these  small  lines  in  1922  were  only  4%  of  the  revenue  ton  miles  of  the  Boston 
&  Maine  system,  and  the  passenger  miles  were  only  2%  of  the  passenger  miles  of  the  Boston 
&  Maine  system:  Vermont  Valley,  St.  Johnsbury  &  Lake  Champlain,  Mount  Washington, 
Montpelier  &  Wells  River,  Sullivan  County,  York  Harbor  &  Beach,  Barre  &  Chelsea. 


' 


, 


\ 


: 


301 


APPENDIX  L 

Revenue  Ton  Miles  and  Passenger  Miles 
Boston  &  Albany  Railroad 
1903-1922 


302 


APPENDIX  M 

Revenue  Ton  Miles  and  Passenger  Miles 
Maine  Central  Railroad 
1903-1922 


1903  1904  1905  1906  1907  1908  1909  1910  1911  1912  1913  1914  1915 


1919  1920  1921  1922 


1917 


Revenue  Ton  Miles 


Passenger  Miles 


1903  1904  1905  1906  1907  1908  1909  1910  1911  1912  1913  1914  1915  1916  1917  1918  1919  1920  1921  1922 


1000 

900 

800 

700 

600 

500 

400 

300 

200 

10C 

C 


900 


800 


700 


6C0 


500 


400 


300 


200 


100 

0 


i 


303 


APPENDIX  N 

Revenue  Ton  Miles  and  Passenger  Miles 
Bangor  &  Aroostook  Railroad 
1903-1922 


304 


APPENDIX  O 


Revenue  Ton  Miles  and  Passenger  Miles 
Central  Vermont  Railway 


305 


APPENDIX  P 

Revenue  Ton  Miles  and  Passenger  Miles 
Atlantic  &  St.  Lawrence  Railroad 
1903-1922 


306 


APPENDIX  Q 

Revenue  Ton  Miles  and  Passenger  Miles 
Rutland  Railroad 
1903-1922 


APPENDIX  R 


307 


APPENDIX  R 

EXPENDITURES  OF  COMMONWEALTH  OF  MASSACHUSETTS  ON  PORT  OF  BOSTON  1859-1922  (Oct.  31) 


1859-1922 

Boston 

Harbor 

Common¬ 

wealth 

Flats 

E.  B. 

Common¬ 

wealth 

Flats 

S.  B. 

1859-1870 

$19,475.87 

1870-1911 

$1,561,225.24 

$35,084.27 

3, 845^500.60 

Incl. 

1912 

19,768.53 

339,961.81 

1913 

6,734.35 

6,215.03 

249,969.89 

1914 

9,408.94 

119,353.21 

165,603.55 

1915 

8,702.17 

39,491.47 

70,513.49 

1916 

183.49 

869,451.77 

80,270.48 

1917 

1,908.61 

11,400.97 

12,323.01 

1918 

6,542.74 

223,130.38 

1,089,532.52 

1919 

2,887.88 

303,105.40 

175,454.71 

1920 

21,102.33 

226,661.08 

344,344.50 

1921 

15,824.60 

349,466.74 

119,232.02 

1922 

to  Oct.  31 

Incl. 

80.97 

440,292,64 

86,104.79 

$1,654,369.85 

$2,623,652.96 

$6,598,287.24 

Common¬ 

wealth 

Pier 

6 


$381,877.09 
i, 887, 061.87 


1,557,408.88 

71,530.07 

72,259.58 

16,133.76 


76,916.24 


$4,063,187.49 


Dry 

Dock 


$435.50 

13,872.02 


273,459.42 

194,466.97 

188,379.20 

411,563.96 

438,289.69 

1,441,178.75 

155,755.64 

45,000.00 


2,250.00 


$3,164,651.15 


Hayward 

Creek 


$310.68 

17,445.71 

76,086.64 

165,975.33 

124,311.77 

1,554.75 


$385,684.88 


Mystic 

River 


$15,957.52 

3,959.06 

82,091.02 

161,856.70 


425.01 

133,549.47 

1,220.00 


10,840.54 


$409,899.32 


Malden 

River 


$31,000.00 


1,268.70 


$32,268.70 


Chelsea 

Creek 


$18,844.08 

12,195.02 

29,132.14 

134.62 


34.87 


3,340.73 


Commer¬ 
cial  Point 
Dorchester 
Bay 


$24,912.71 

28,300.39 


$53,213.10 


Common¬ 
wealth  Pier 
1-E.  B. 


$725,000.00 

39,600.00 


197,351.88 

151,954.01 

752.91 

3,911.43 


1,118,570.23 


Total 


.  $19,475.S7 
5,824,122.70 


359,730.34 

2,163,853.16 

2,891,104.23 

456,563.62 

1.292.946.22 
651,476.80 

2,043,128.87 

2.270.113.23 
1,037,612.32 

613,125.78 


540,872.51 


Total  expenditures  for  development  and  improvement  $20,164,125.65 


Operation  and  Maintenance  op  Property 


Common¬ 
wealth  Pier 
5-S.  B. 


$7,671.43 

35,697.12 

43,208.09 

52,005.43 

62,916.37 

35,961.81 

12,103,46 

77,027.31 

11,718.95 


84,396.73 


$422,706.70 


Common¬ 
wealth  Pier 
1-E.  B. 


$5,837.28 

14,276.87 

12,120.48 


7,340.84 


$39,575.47 


Other 

Property 


$117.50 

4,268.47 

27,112.34 

9,461.23 

25.486.43 
70,585.01 

59.396.44 
59,434.22 


38,770.04 


$294,631.68 


Total 


$7,671.43 

35,814.62 

47,476.56 

79,117.77 

72,377.60 

61,448.24 

88,525.75 

150,700.62 

83,273.65 


130,507.61 


Total  expenses  for  operation  and  maintenance  $756,913.85 


' 

' 


309 


APPENDIX  S 

TENTATIVE  SYSTEM  7A 
NEW  ENGLAND— GREAT  LAKES 

Extract  from  Statement  of  William  S.  Jenney,  Counsel 
for  the  Delaware,  Lackawanna  &  Western  Railroad,  be¬ 
fore  the  Interstate  Commerce  Commission  in  Washing¬ 
ton,  May  19,  1923. 

<<Our  objections  to  proposed  System  7 a. 

The  roads  suggested  for  this  System  are  the  following: 

New  York,  New  Haven  &  Hartford, 

New  York,  Ontario  &  Western, 

Central  New  England, 

Boston  &  Maine, 

Maine  Central, 

Bangor  &  Aroostook, 

Lehigh  &  Hudson  River, 

Lehigh  &  New  England, 

Delaware  &  Hudson, 

Ulster  &  Delaware, 

Delaware,  Lackawanna  &  Western, 

Buffalo,  Rochester  &  Pittsburgh, 

Pittsburgh  &  Shawmut, 

Pittsburgh,  Shawmut  &  Northern. 

We  do  not  understand  that  Professor  Ripley  suggested 
any  such  alliance,  nor  can  we  believe  that  it  has  been  seri¬ 
ously  considered  by  anyone.  The  Lackawanna  was  the 
last  of  the  trunk  lines  to  establish  through  rates  with  the 
New  Haven  road,  such  rates  not  having  been  put  into  effect 
until  the  year  1902.  The  rates  when  established  were  not 
with  the  idea  of  securing  for  the  Lackawanna  any  con- 


310 


siderable  New  Haven  business,  but  with  the  idea  of  re¬ 
lieving  embarrassment  with  respect  to  serving  its  shippers, 
who  had,  at  times,  some  traffic  for  New  England  points. 
The  Lackawanna  has  no  physical  connection  or  direct  in¬ 
terchange  with  any  of  the  New  England  lines.  Its  inter¬ 
change  with  the  New  Haven  is  through  the  Lehigh  & 
Hudson  via  Maybrook,  and  with  the  Boston  &  Maine 
through  the  Delaware  &  Hudson  via  Mechanicville.  Upon 
establishing  through  rates  with  the  New  Haven  in  1902, 
the  Lackawanna  found  the  chief  lines  of  New  England 
traffic,  so  far  as  such  traffic  moved  from  the  west,  strongly 
held  by  its  competitors,  and  very  little  of  such  traffic  has 
ever  moved  over  its  lines.  The  Delaware,  Lackawanna  & 
Western  Coal  Company  routes  none  of  the  anthracite  coal 
produced  from  the  mines  formerly  owned  by  the  Lacka¬ 
wanna  to  New  England,  and  very  little  of  the  anthracite 
coal  produced  along  the  lines  of  the  Lackawanna  is  shipped 
to  New  England  points.  In  the  New  England  Divisions 
case  figures  were  prepared  showing  the  freight  traffic  in¬ 
terchanged  by  the  New  England  railroads  with  the  trunk 
lines  over  six  alternative  months  from  December  1918, 
to  October  1919.  From  these  six  months  ’  figures  a  con¬ 
structive  year  was  completed  on  the  basis  which  the 
freight  revenue  for  those  six  months  bore  to  the  total 
freight  revenue  for  the  twelve  months  ending  October  31, 
1919.  This  statement,  so  prepared  by  the  New  England 
roads,  showed  the  traffic  interchanged  between  them  and 
the  trunk  lines  to  be  as  follows: 


Merchandise  Coal  Total 


Central  EE.  of  N.  J . 

Delaware  &  Hudson  Co . 

D.  L.  &  W.  EE . 

Erie  Bailroad  . 

Lehigh  &  New  England . 

Lehigh  Valley  EE . 

N.  Y.  Central  BE.  Co.  (includ¬ 
ing  B.  &  A.  EE.)  . 

N.  Y.,  0.  &  Western . 

Pennsylvania  EE . 


1,651,994 

2,311,261 

3,963,255 

2,699,901 

3,479,360 

6,179,261 

547,967 

17,002 

564,964 

847,136 

531,554 

1,378,690 

124,390 

414,584 

538,974 

745,515 

824,219 

1,569,734 

5,906,599 

2,521,257 

8,427,856 

64,225 

465,693 

529,918 

3,279,654 

3,403,140 

6,682,794 

311 


While  it  is  true  that  the  System  contemplates  the  in¬ 
clusion  of  the  Delaware  &  Hudson,  and  that  large  inter^ 
change  is  shown  from  the  statement  to  have  been  had 
between  the  New  England  roads  and  the  Delaware  &  Hud¬ 
son,  it  is  well  known  that  one  of  the  large  items  of  such 
interchange  consists  of  anthracite  coal  which  is  shipped 
by  the  Hudson  Coal  Company  and  other  anthracite  shippers 
along  the  line  of  the  Delaware  &  Hudson  Company  into 
New  England  and  the  principal  item  consisting  of  bitumi¬ 
nous  coal.  The  principal  interchange  of  the  New  England 
roads,  however,  is  with  the  New  York  Central  and  the 
Pennsylvania.  The  latter  company  by  large  capital  ex¬ 
penditures  has  effected  a  direct  rail  connection  with  the 
New  Haven  road  through  the  New  York  Connecting  Rail¬ 
way.  It,  and  the  New  York  Central  are  and  must  always 
continue  to  be  favored  routes  for  the  shipment  of  traffic 
to  and  from  New  England. 

If  there  be  any  meaning  to  the  words  of  the  law  that 
‘  existing  routes  and  channels  of  trade  and  commerce 
shall  be  maintained,’  certainly  no  effort  should  be  made 
to  attempt  to  divert  New  England  tonnage  to  the  Lacka¬ 
wanna.  Such  effort  would  be  equally  disastrous  to  the 
New  England  roads  and  to  the  Lackawanna. 

The  principal  raw  materials  used  in  New  England  are 
wool,  cotton,  iron  and  steel,  lumber  and  petroleum  prod¬ 
ucts,  in  addition  to  anthracite  and  bituminous  coal.  We 
have  already  shown  that  none  of  the  anthracite  coal  pro¬ 
duced  from  the  former  Lackawanna  mines  is  shipped  to 
New  England  and  as  the  routing  of  this  coal  is  in  the 
hands  of  a  separate  corporation,  the  Delaware,  Lacka¬ 
wanna  and  Western  Coal  Company,  no  change  could  be 
expected  as  the  result  of  consolidation.  With  respect  to 
bituminous  coal  there  has  been  and  doubtless  always  will 
be  a  large  movement  by  water.  The  economy  of  carriage 
of  bituminous  coal  in  large  cargoes  by  water  from  Nor¬ 
folk  and  Baltimore  to  various  ocean  ports  reached  by  the 
New  England  lines  must  continue  to  necessitate  such 


312 


movement.  Of  the  rail  coal  a  considerable  quantity  is 
now  being  handled  over  roads  proposed  to  be  consolidated 
in  the  system  with  respect  to  which  there  would  be  no 
saving  except  at  the  expense  of  the  present  earnings  to 
such  line.  While  some  saving  would  doubtless  be  made  in 
more  extended  purchases  of  bituminous  coal  from  points 
either  near  or  tributary  to  mines  of  the  system  the  same 
would  be  inconsequential  so  far  as  controlling  the  pro¬ 
posed  plan.  With  respect  to  the  other  commodities  we 
find  the  following.  In  the  calendar  year  1921  the  Lacka¬ 
wanna  handled  about  18,000  tons  of  wool,  the  New  Haven 
143,000.  As  the  Lackawanna  has  several  woolen  mills  on 
its  own  line  it  is  clear  that  little  wool  for  the  New  Haven 
road  was  hauled  over  its  line.  In  the  same  year  the  Lacka¬ 
wanna  handled  about  61,000  tons  of  cotton,  the  New  Haven 
361,000  tons.  As  cotton  is  consumed  at  many  points  on  the 
Lackawanna  System  it  follows  that  little  of  this  com¬ 
modity  was  handled  over  its  line  for  New  Haven  points. 
In  the  same  year  Lackawanna  handled  248,000  tons  of 
petroleum  products,  New  Haven  1,253,000.  The  Lacka¬ 
wanna  does  not  reach  any  of  the  large  petroleum  plants 
in  New  Jersey,  Pennsylvania  or  New  York,  but  serves  a 
considerable  market  for  such  products  and  performs  inter¬ 
mediate  service  on  a  considerable  movement,  which  is 
neither  to  nor  from  New  England,  and  it  could  not  have 
participated  to  any  material  extent  in  the  haulage  of  these 
products  for  New  Haven  destinations.  An  examination 
by  us  of  similar  statistics  with  respect  to  iron,  steel  and 
lumber  results  in  the  same  conclusion. 

The  interchange  statement  above  shows  the  interchange 
between  New  Haven  and  Lackawanna  via  Maybrook,  but 
not  the  interchange  between  Lackawanna  and  Boston  & 
Maine  points  via  Mechanicville,  which  in  the  statement  is 
credited  to  the  Delaware  &  Hudson,  the  line  through 
which  we  interchange.  Figures  of  interchange,  therefore, 
between  the  Lackawanna  and  Boston  &  Maine  are  not 
available.  The  tons  interchanged  at  this  gateway  between 


313 


Boston  &  Maine  and  Delaware  &  Hudson  as  above  sug¬ 
gested  represent  largely  coal  and  include  also  interchange 
though  this  gateway  via  the  Delaware  &  Hudson  from  the 
Erie,  Pennsylvania  and  Lehigh  Valley  and  Central  Rail¬ 
road  of  New  Jersey  roads  in  addition  to  the  Lackawanna; 
probably  also  some  other  scattering  connections. 

There  are  consumed  in  Boston  &  Maine  territory  large 
quantities  of  the  same  commodities  referred  to  with  re¬ 
spect  to  the  New  Haven,  which  do  not  originate  on  the 
Lackawanna  or  its  connections.  An  examination  by  our 
Traffic  Department  satisfies  us  that  the  Lackawanna  is  a 
minor  factor  as  to  Boston  &  Maine  traffic. 

In  view  of  the  foregoing  it  is  apparent  that  from  a 
traffic  standpoint  no  public  benefit  could  result  from  such  a 
consolidation  as  is  proposed. 

When  we  consider  the  same  from  an  operating  stand¬ 
point  we  find  that  any  effort  to  change  the  routing  of 
traffic  from  the  existing  routes  via  the  route  suggested  in 
this  consolidation  would  result  in  longer  mileage,  large 
capital  expenditures  for  additional  terminal  yards  and  in¬ 
terchange  tracks  and  the  substitution  of  a  more  expensive 
route  with  respect  to  curves  and  grades  than  the  route 
over  which  the  traffic  has  in  the  past  moved.  The  natural 
route  for  New  England  traffic  south  and  southwest  is  via 
the  Pennsylvania  and  Baltimore  &  Ohio  lines;  particularly 
the  former.  The  natural  route  west  from  the  northern 
portion  of  the  New  England  territory  is  via  the  New 
York  Central  and  from  the  southern  portion  via  the  Penn¬ 
sylvania.  While  some  traffic  may  advantageously  move 
via  Maybrook  and  Mechanicville  over  lines  of  the  other 
trunk  line  carriers  it  is  limited  in  amount  and  any  attempt 
to  increase  it  would  be  at  such  an  increased  cost  of  opera¬ 
tion  as  to  be  of  little  profit  to  the  proposed  consolidated 
line. 

Lastly,  when  we  consider  this  proposed  consolidation 
from  a  financial  standpoint  we  have  but  to  turn  to  the  re¬ 
sult  of  the  operation  of  the  lines  forming  the  proposed 


314 


system  for  the  year  1921  which  is  on  Exhibit  3  attached.  The 
showing  for  the  year  1922  would  have  been  disastrous  be¬ 
cause  of  the  shop  crafts  and  anthracite  strikes,  and  because 
of  the  increased  cost  of  coal  resulting  from  the  bituminous 
strike.  1921  is  an  average  year,  and  shows  from  the  Ex¬ 
hibit  3-C  that  this  system  would  have  failed  by  over 
twenty  million  dollars  to  pay  its  fixed  charges.  The  ques¬ 
tion,  therefore,  remains,  would  such  a  consolidation  result 
in  increased  earnings?  The  answer,  of  course,  must  be  in 
the  negative.  If  the  Lackawanna  alone  of  the  trunk  lines 
is  to  end  at  Buffalo  and  all  of  its  connections  at  Buffalo 
are  to  be  consolidated  with  other  trunk  lines  it  is  apparent 
that  but  little  traffic  moving  from  western  points  to  New 
York  can  be  expected  to  be  turned  over  by  its  competitors 
to  the  Lackawanna  at  Buffalo.  To  do  so  would  be  to  de¬ 
prive  its  competitors  of  the  long  haul  to  New  York.  More¬ 
over,  as  has  been  shown,  it  would  be  unlikely  that  the 
Lackawanna  could  give  to  such  shippers  as  good  service 
to  New  England  points  as  could  be  given  by  the  Pennsyl¬ 
vania  and  New  York  Central  over  more  direct  and  eco¬ 
nomical  routes.  We  have  already  shown  that  from  a 
financial  standpoint  the  Lackawanna,  with  its  free  surplus 
taken  away,  could  not  carry  the  load  of  weaker  lines.  It 
certainly  could  not,  if  consolidated  with  the  New  Eng¬ 
land  Lines,  help  them  financially  and  the  result  would  be 
to  pull  the  Lackawanna  into  the  same  unfortunate  situa¬ 
tion  as  now  confronts  the  New  England  Lines. 

The  New  England  situation  is  a  most  difficult  one  to 
solve  in  any  effort  to  consolidate  the  railroads  of  the 
United  States  into  systems  which  may  successfully  com¬ 
pete  and  earn  a  reasonable  return  upon  the  value  of  the 
properties  making  up  such  systems,  but  certainly  no  solu¬ 
tion  can  be  found  in  any  effort  to  tie  up  the  New  England 
Lines  with  one  of  the  trunk  lines,  such  as  the  Lackawanna 
or  Lehigh  Valley.  It  would  be  more  natural  to  divide 
such  lines  to  the  Pennsylvania  and  New  York  Central 
Systems.  To  do  this,  however,  would  not  only  tend  to 


315 

augment  to  size  of  corporations  already,  in  the  opinion 
of  many  experts,  too  large  for  the  best  and  most  efficient 
operation,  but  would  render  the  creation  of  other  com¬ 
peting  lines  in  Official  Classification  Territory  the  more 
difficult.  In  our  view,  therefore,  the  most  practical  solu¬ 
tion  is  the  consolidation  of  the  New  England  Lines  into 
one  system  with  such  preferential  treatment  with  respect 
to  division  of  rates  as  can  fairly  be  made  and  in  the  hope 
that  through  consolidation  economy  of  operation  may  re¬ 
sult  to  an  extent  sufficient  to  put  such  lines  on  a  paying 
basis.” 

Quoted  from  'printed  statement  of 
William  S.  Jenney,  before  the  Inter¬ 
state  Commerce  Commission. 

Docket  No.  12,964  (pp.  10-18) 


' 


i9 


■ 


317 


APPENDIX  T 

THE  NEW  YORK,  NEW  HAVEN  &  HARTFORD 
RAILROAD  COMPANY 

TENTATIVE  PLAN  OF 
READJUSTMENT  OF  CAPITALIZATION 


Preliminary 

The  purpose  of  this  plan  is  without  a  receivership  to  pro¬ 
vide  for  such  a  reduction  of  the  fixed  charges  of  the  New 
Haven  Company  as  will,  with  the  State  cooperation  sug¬ 
gested  in  the  Committees’  report,  fully  restore  the  credit 
of  the  Company. 

Obviously  the  fixed  charges  cannot  be  reduced  ratably, 
but  due  regard  must  be  had  to  the  position  and  security  of 
each  item.  The  distribution  of  the  reduction  among  the 
several  issues  of  securities  must  be  finally  determined  by 
holders  of  the  issues  affected,  and  the  details  of  this  plan 
are  submitted  as  suggestions  for  consideration  in  the  belief 
that  they  may  be  of  material  assistance,  since  they  have 
been  arrived  at  impartially  and  from  the  point  of  view  of 
a  survey  of  the  system  as  a  whole,  with  the  benefit  of  all 
facts  developed  by  the  study  which  the  Committee  has 
made. 

The  plan  presents  a  classified  statement  of  funded  debt 
and  fixed  charges,  together  with  a  program  for  its  treat¬ 
ment.  In  formulating  this  classified  statement  an  attempt 
has  been  made  to  include  the  charges  resting  upon  all 
parts  of  the  system,  and  to  group  these  charges  in  such 
manner  as  will  be  most  convenient  for  reference. 

Throughout  the  plan  an  attempt  is  made  to  give  net 
figures  after  eliminating  intercompany  holdings  and  in  this 
connection  ignoring  for  the  sake  of  simplicity  the  fact  that 
the  leases  are  not  perpetual. 


318 


NEW  HAVEN  SYSTEM  CAPITALIZATION 

as  of  December  31,  1922 

I.  Fixed  Charges 

FIRST  PART:  RAIL  SYSTEM  ITEMS 


{Includes  All  Leased  Rail  Lines,  Central  New  England,  New  York,  Westchester 
&  Boston,  and  one-half  New  York  Connecting,  and  excludes  intercompany  items 
among  these  companies) 

{Excludes  Boston  Terminal  Company,  Boston  &  Maine,  New  York,  Ontario  & 
Western,  and  Rutland) 

A.  New  Haven  Company  Liabilities: 


Principal  Annual 

Item  Amount  Charges 

1.  Equipment  Trust  Obligations . $10,066,700  $590,837 

2.  Divisional  Liens  (See  detail  p.  320) .  56,490,000  2,402,225 

3.  Secured  Notes  Issued  to  Federal  Government  .  83,646,500  5,018,790 

4.  Debentures  Expressly  Secured  by  First  and 

Refunding  Mortgage  (See  detail  p.  321) .  .  .  133,358,351  6,719,414 

5.  Other  Debentures  (See  detail  p.  321) .  16,758,000  670,320 

6.  Central  New  England  (See  detail  p.  321)  .  .  .  12,227,000  495,080 

7.  New  York,  Westchester  &  Boston  4Ks  of  1946  19,200,000  864,000 

8.  Leased  Line  Stocks  and  Bonds  (See  detail  p.  322)  40,767,725  2,536,594 

9.  One-half  New  York  Connecting  Railroad  Co. 

4^s  of  1953  12,000,000  540,000 

10.  Boston  Railroad  Holding  Company  4%  Pre¬ 
ferred  Stock  .  2,800,000  112,000 


Total  Group  A . $387,314,276  $19,949,260 

B.  Rail  Obligations  on  Which  the  New  Haven  Com¬ 
pany  is  Not  Liable : 

11.  For  detail  see  page  322  .  3,700,800  128,566 


Total  Groups  A  and  B . $391,015,076  $20,077,826 

SECOND  PART:  TROLLEY  AND  MARINE  SUBSIDIARY  ITEMS 

{Excludes  intercompany  items  and  all  New  England  Investment  &  Security  items 
upon  which  the  New  Haven  Company  is  not  liable) 

C.  On  Which  the  New  Haven  Company  is  Liable: 

12.  Trolley  (See  detail  p.  323) .  26,686,575  1,199,880 

Total  Groups  A,  B  and  C . $417,701,651  $21,277,706 

D.  On  Which  the  New  Haven  Company  is  Not  Liable : 

13.  Trolley  (See  detail  p.  323) .  $2,234,000  $122,160 

14.  Hartford  &  New  York  Transportation  Company 

4^s  of  1934  183,000  7,635 


$2,417,000 

$129,795 

$29,103,575 

$1,329,675 

Total  Group  D . 

Total  Groups  C  and  D  .  . 
Total  Groups  A,  B,  C  and  D 


$420,118,651  $21,407,501 


319 


II.  Capital  Stock 

Outstanding  Par  Value  Exclusive  of  Premiums  $157,117,900 

III.  Note 

The  total  principal  amount  of  fixed  charge  obligations  as 
given  in  Group  A  above  varies  from  the  sum  of  $317,239,595, 
given  on  p.  62  of  the  accompanying  report  chiefly  in 
that  Group  A  includes,  and  the  other  figure  does  not,  the 
Leased  Line  Stock  and  Bonds,  half  the  New  York  Connect¬ 
ing  Railroad  4*4  s,  and  the  guaranteed  bonds  of  the  New 
York,  Westchester  &  Boston. 

The  annual  fixed  charge  of  $20,077,826  given  for  Groups 
A  and  B  above  varies  from  the  annual  fixed  charge  item 
of  $20,919,731  given  for  1922  on  p.  212  of  the  committee’s 
report  chiefly  in  that  the  former  item  omits  the  “  Other 
Deductions  ’  ’  of  $1,667,882  and  minor  rental  items  included 
in  the  report,  but  includes  the  interest  on  the  New  York 
Connecting  Railroad  Bonds  which  in  the  report  are  covered 
in  the  operating  revenue  item. 


NEW  HAVEN  SYSTEM  CAPITALIZATION  —  DETAIL 

DETAIL  OF  ITEM  2:  DIVISIONAL  LIENS 


Principal 

Name  Rate  Due  Amount 


New  York,  Providence  &  Boston  . 

Housatonic  R.R.  Co . 

Danbury  &  Norwalk  R.R . 

u  u  u  u 

Naugatuck  R.R.  Co . 

Boston  &  New  York  Air  Line  R.R. 

Providence  Terminal  Co . 

Worcester  &  Conn.  Eastern  Ry.  Co. 
N.  H.  &  Centerville  St.  Ry.  Co.  . 

Meriden  Horse  R.R.  Co . 

Norwich  St.  Ry.  Co . 

New  London  St.  Ry.  Co . 

Hartford,  Manchester  &  Rockville 

Tramway  Co . 

Hartford  St.  Ry.  Co . 

Greenwich  Tramway  Co . 

Meriden,  Southington  &  Com- 

pounce  Tramway  Co . 

Pawtuxet  Valley  R.R.  Co . 

New  England  R.R.  Co . 

u  a  u  a 

Stafford  Springs  St.  Ry.  Co.  .  .  . 
New  Haven  &  Northampton  .  .  . 
N.  Y.,  N.  H.  &  H.  R.R.- Harlem 

River  &  Port  Chester . 

Branford  Elec.  Co . 

Total  Bond  Issues . 

Suffolk  Savings  Bank  for  Seamen 
and  Others  —  Mortgage  Note  . 
Trustees  Columbus  Avenue  Trust, 
Boston  —  Real  Estate  Mortgage 
Sophia  Keeley  —  3-year  mortgage . 

Total  Miscellaneous  .... 

Grand  Total . 


4 

April  1,  1942 

$1,000,000 

5 

Nov.  1,  1937 

2,839,000 

5 

April  1,  1925 

150,000 

4 

June  1,  1955 

350,000 

4 

May  1,  1954 

2,500,000 

4 

Aug.  1,  1955 

3,777,000 

4 

Mar.  1,  1956 

4,000,000 

4H 

Jan.  1,  1943 

1,601,000 

5 

Sept.  1,  1933 

283,000 

5 

Jan.  1,  1924 

415,000 

5 

Oct.  2,  1923 

350,000 

5 

Oct.  2,  1923 

150,000 

5 

Oct.  1,  1924 

200,000 

4 

Sept.  1,  1930 

2,500,000 

5 

July  1,  1931 

320,000 

5 

July  1,  1928 

175,000 

4 

April  1,  1925 

160,000 

4 

July  1,  1945 

10,000,000 

5 

July  1,  1945 

7,500,000 

5 

July  1,  1956 

400,000 

4 

June  1,  1956 

2,400,000 

4 

May  1,  1954 

15,000,000 

5 

Oct.  1,  1937 

60,000 

$56,130,000 

5  H 

$200,000 

6 

75,000 

6 

85,000 

360,000 

$360,000 


$56,490,000 


Annual 

Charges 

$40,000 

141,950 

7,500 

14,000 

100,000 

151,080 

160,000 

72,045 

14,150 

20,750 

17,500 

7,500 

10,000 

100,000 

16,000 

8,750 

6,400 

400,000 

375,000 

20,000 

96,000 

600,000 

3,000 


$2,381,625 


20,600 


$20,600 


$2,402,225 


321 


DETAIL  OF  ITEM  4:  DEBENTURES  EXPRESSLY  SECURED  BY 
FIRST  AND  REFUNDING  MORTGAGE 


Name 

Rate 

Due 

Principal 

Amount 

Annual 

Charges 

New  Haven  Convertible  .  .  . 

3V2 

1956 

$8,913,350 

$311,967 

New  Haven  Non-Convertible  . 

1947 

4,991.000 

174,685 

u  u  u 

3  M 

1954 

9,997,900 

349,926 

Naugatuck  Railroad  Co.  .  .  . 

sy2 

1930 

234,000 

8,190 

Total  . 

$24,136,250 

$844,768 

New  Haven  Non-Convertible  . 

4 

1947 

$5,000,000 

$200,000 

a  u  u 

4 

1955 

15,000,000 

600,000 

((  u  u 

4 

1956 

15,000,000 

600,000 

Hartford  St.  Ry.  Co.,  Series  M 

4 

1930 

165,000 

6,600 

The  Consolidated  Ry.  Co.  .  . 

4 

1930 

969,650 

38,786 

u  u  u  u 

4 

1954 

4,255,000 

170,200 

a  u  u  u 

4 

Jan.  1955 

2,309,000 

92,360 

u  u  a  a 

4 

April  1955 

1,340,000 

53,600 

u  a  a  u 

4 

1956 

2,011,000 

80,440 

Total  4s . 

$46,049,650 

$1,841,986 

New  Haven  Station . 

5 

1923-4 

$200,000 

$10,000 

New  Haven  Convertible  .  .  . 

6 

1948 

38,541,200 

2,312,472 

New  Haven  European  Loan 
Extended  . 

7 

1925 

24,431,251 

1,710,188 

Grand  Total . 

$133,358,351 

$6,719,414 

DETAIL  OF  ITEM  5:  OTHER  DEBENTURES 


Name 

Rate  Due 

Principal 

Amount 

Annual 

Charges 

Providence  Securities  Co.  Gold 

Debentures . 

New  Haven  Gold  Debentures  .  .  . 

.  4 
.  4 

1957 

1957 

$5,595,000 

11,163,000 

$223,800 

446,520 

Total . 

.  $16,758,000 

$670,320 

DETAIL  OF  ITEM  6:  CENTRAL  NEW 
WHICH  THE  NEW  HAVEN 

ENGLAND  OBLIGATIONS  UPON 
COMPANY  IS  LIABLE 

Name 

Rate  Due 

Principal 

Amount 

Annual 

Charges 

Central  New  England  Gold 

(Note  A) . _ . 

Central  New  England  Serial  Notes 
(Note  B)  . . 

.  4 

.  6 

1961 

1931-5 

$11,927,000 

300,000 

$477,080 

18,000 

Total . 

$12,227,000 

$495,080 

Note  A.  Guaranteed  by  New  Haven. 

Note  B.  Secured  by  $750,000  of  the  Central  New  England  Gold  4s. 


322 


DETAIL  OF  ITEM  8:  LEASED  LINE  STOCKS  AND  BONDS 


Name 

Chatham  Railroad  stock . 

Holyoke  &  Westfield  stock . 

Norwich  &  Worcester  Preferred  stock 
Norwich  &  Worcester  Common  stock 
Providence  and  Worcester  stock  .  .  .  . 

Old  Colony  stock  . . 

Boston  &  Providence  stock . 

Providence,  Warren  and  Bristol  stock  . 

Total  stock . 

Holyoke  and  Westfield  First . 

Providence  and  Worcester  First  .  .  .  . 
Norwich  and  Worcester  Debentures  .  . 
Boston  and  Providence  Debentures  .  . 
Old  Colony  Plain . 

a  a  a 

u  a  a 

a  ii  it 


Total  bonds . 

Grand  Total  Stocks  and  Bonds 


Rate  Due 

Principal 

Amount 

Annual 

Charges 

5  .... 

$68,200 

$3,610  A 

14  B  .... 

240,000 

37,670  B 

8  .... 

2,902,900 

232,232 

•  •••  «... 

6,600 

10  .... 

2,544,900 

260,490  A 

7  .... 

12,481,925 

873,734 

10  .... 

3,471,400 

350,140  A 

6 

387,800 

23,268 

$22,103,725 

$1,781,144 

4^ 

1951 

$196,000 

$8,330  B 

4 

1947 

1,500,000 

60,000 

4 

1927 

1,200,000 

48,000 

6 

1923 

2,170,000 

130,200 

4 

1938 

4,000,000 

160,000 

3 

1924 

3,000,000 

90,000 

4 

1925 

5,598,000 

223,920 

3  H 

1932 

1,000,000 

35,000 

$18,664,000 

$755,450 

$40,767,725 

$2,536,594 

Note  A.  Includes  allowances  for  organization  expense:  $200  to  Chatham 
Railroad,  $6,000  to  Providence  and  Worcester,  and  $3,000  to  Boston  and  Provi¬ 
dence. 

Note  B.  Annual  rental  is  fixed  amount,  of  which  in  above  table  the  necessary 
amount  is  allocated  to  interest  on  funded  debt,  and  the  balance  to  dividends  on 
stock.  Dividend  rate  given  on  stock  is  amount  currently  paid. 


DETAIL  OF  ITEM  11:  RAIL  OBLIGATIONS  UPON  WHICH  THE  NEW 

HAVEN  IS  NOT  LIABLE 


Name 

Hartford  &  Conn.  Western  Stock 
“  “  “  “  First 

Dutchess  County  First 

N.  Y.  &  N.  E.  R.R.  -  Boston 
Terminal  First 


Rate 

\ 

Due 

Principal 

Amount 

Annual 

Charges 

.  2 

•  4  H 

•  4^ 

1923 

1940 

$1,218,800 

700,000 

282,000 

$24,376 

31,500 

12,690 

.  4 

1939 

1,500,000 

60,000 

$3,700,800 

$128,566 

Total 


323 


DETAIL  OF  ITEM  12:  TROLLEY  CAPITALIZATION  UPON  WHICH 
THE  NEW  HAVEN  COMPANY  IS  LIABLE 


Principal  Annual 
Name  Rate  Due  Amount  Charges 

N.  E.  Investment  &  Security  Preferred 

Stock  . 4  ....  $112,100  B  $4,484  A 

Springfield  Railways  Preferred .  ...  4  _  3,387,900  B  135,516  A 

Connecticut  Ry.  and  Lighting  Lease 
(NoteC)  . 

Bonds  of  Conn.  R.  &  L .  13,466,000  B  . 

Stock  of  Conn.  R.  &  L .  17,120,100  . 

Total  Rental .  $1,400,000  A 

N.  Y.  &  Stamford  Ry.  Bonds . 4  1958  247,000  B  9,880  A 


Total . . $34,333,100  $1,549,880 

Less  25%  of  Conn.  Railway  &  Lighting  Items 

(NoteC) .  7,646,525  350,000 


Balance . $26,686,575  $1,199,880 


Note  A.  Guaranteed  as  to  interest  or  dividends  by  New  Haven  Company,  in 
form  or  in  effect. 

Note  B.  Guaranteed  as  to  principal  by  the  New  Haven  Company. 

Note  C.  While  the  New  Haven  Company  remains  liable  for  the  whole 
$1,400,000  annual  rent,  the  sub-lessee  of  the  gas  and  electric  properties  covered 
by  this  lease  has  agreed  to  pay  25%  of  the  total  rent  and  it  is  believed  may  safely 
be  considered  good  for  the  amount.  For  that  reason  this  quarter  of  the  total 
rent  is  deducted,  even  though  the  New  Haven  still  remains  liable  for  it.  As  to 
the  remaining  three-quarters  of  the  rent,  the  Connecticut  Company  is  the  prin¬ 
cipal  obligor  and  as  the  New  Haven  Company  owns  all  the  stock  of  the  Con¬ 
necticut  Company  it  seems  clear  that  this  portion  of  the  rent  must  be  considered 
a  part  of  the  capitalization  of  the  system. 


DETAIL  OF  ITEM  13:  TROLLEY  CAPITALIZATION  UPON  WHICH 
THE  NEW  HAVEN  COMPANY  IS  NOT  LIABLE 


Name 

Berkshire  St.  Ry.  Bonds 

It  II  It 

a  a  a 


Connecticut  Co.  Equipment  Trust 
Obligations . 

N.  Y.  and  Stamford  St.  Ry.  .  .  . 


Rate 

7 

4 

4 

Due 

1927 

1924 

1923 

Principal 

Amount 

$800,000 

400,000 

300,000 

Annual 

Charges 

$56,000 

16,000 

12,000 

$1,500,000 

$84,000 

$308,000 

$16,860 

5 

1931 

426,000 

21,300 

Total 


$2,234,000  $122,160 


NEW  STOCK 


A  new  preferred  stock  to  be  created,  entitled  to  dividends 
at  the  rate  of  five  per  cent  per  annum  in  priority  to  the 
common  stock  and  no  more;  cumulative  from  and  after 
January  1,  1927;  divided  into  shares  of  the  par  value  of 
$100  each;  convertible  into  common  stock  at  the  option 
of  the  holder  at  any  time  in  the  ratio  of  one  and  one- 
quarter  shares  of  common  stock  for  each  share  of  preferred 
stock;  sharing  all  voting  powers  with  the  common  stock 
upon  the  basis  of  three  votes  for  each  share  of  preferred 
stock  and  one  vote  for  each  share  of  common  stock;  and 
preferred  over  the  common  stock  in  liquidation  at  the  rate 
of  one  hundred  dollars  a  share  and  cumulative  dividends 
accrued  and  then  unpaid  thereon,  and  no  more. 

The  capital  stock  now  outstanding  to  be  converted,  share 
for  share,  into  common  stock  of  no  par  value.  Both  the 
preferred  stock  and  the  common  stock  to  be  issuable  up  to 
such  aggregate  amounts  as  from  time  to  time  shall  be  au¬ 
thorized  by  the  commissions  and  other  authorities  having 
jurisdiction. 


325 


DISPOSITION  OF  NEW  STOCK 

New  stock  to  be  presently  issued  as  follows: 

Preferred  Stock:  In  the  cases  of  the  bond  and  debenture 
issues  specified  below,  the  holder  to  surrender  a  certain 
per  cent  (40,  50  or  60  as  specified)  of  the  bonds  and  deben¬ 
tures  he  holds,  and  accept  in  exchange  therefor  new  pre¬ 
ferred  stock  as  follows: 

For  each  $100  of  such  bonds  or  debentures  surren¬ 
dered  bearing  5%  interest  or  less,  one  share  of  preferred 
stock  of  the  par  value  of  $100. 

For  each  $100  of  such  bonds  or  debentures  surren¬ 
dered  bearing  6%  interest  or  more,  one  and  one-fifth 
shares  of  preferred  stock  of  the  par  value  of  $120. 

Common  Stock:  To  be  issued  share  for  share  for  the 
present  capital  stock. 

An  additional  amount,  sufficient  to  raise  about 
$15,000,000,  to  be  offered  to  the  present  stockholders  at 
about  its  market  value.  The  payments  which  the  present 
stockholders  are  thus  to  make  for  additional  stock  will  equal 
$10  a  share  on  their  present  holdings. 


326 


CONVERSION  OF  BONDS  AND  DEBENTURES 
INTO  PREFERRED  STOCK 


Table 

(For  detail  of  basis  see  above  under  heading  Disposition  of  New  Stock ) 


Name  Rate  Due 

w  ,  o 

0  i  H  J 
<  O  *5  H 
Principal  %  &  q® 
Amount  g  g  g q 

Amount 

Reduc¬ 

tion 

Amount 

Pfd. 

Stock 

H  g  H  Pn 

N.  H.  Cony.  Deb.  . 
N.  H.  Non  Conv. 

3K 

1956' 

Deb . 

N.  H.  Non  Conv. 

334 

1947 

$24,136,250  40 

$9,654,500 

$9,654,500 

Deb . 

sy2 

1954 

Naugatuck  R.R.  Deb.  334 

1930  j 

N.  H.  Non  Conv. 

- 

Deb . 

4 

1947 

N.  H.  Non  Conv. 

Deb . 

N.  H.  Non  Conv. 

4 

1955 

Deb . 

Hartford  St.  Ry.  Co. 

4 

1956 

Deb.  Series  M  .  . 

4 

1930 

The  Consolidated 

Ry.  Co.  Deb..  .  . 
The  Consolidated 

4 

1930 

46,049,650  40 

18,419,860 

18,419,860 

Ry.  Co.  Deb.  .  . 
The  Consolidated 

4 

1954 

Ry.  Co.  Deb.  .  . 
The  Consolidated 

4 

1955 

Ry.  Co.  Deb.  .  . 
The  Consolidated 

4 

J955 

Ry.  Co.  Deb.  .  . 

4 

1956  J 

N.  H.  Conv.  Deb.  . 
N.  H.  European  Loan 

6 

1948 

38,541,200  40 

15,416,480 

18,499,776 

Extended.  .... 
Boston  &  N.  Y.  Air 

7 

1925 

24,431,251  40 

9,772,500 

11,727,000 

Line . 

4 

1955 

3,777,000  50 

1,888,500 

1,888,500 

N.  H.  &  Northamp¬ 
ton  Ref.  &  Cons.  . 
N.  Y.  Westchester  & 

4 

1956 

2,400,000  50 

1,200,000 

1,200,000 

Boston  First  .  .  . 
Providence  Secitri- 

434 

1946 

19,200,000  50 

9,600,000 

9,600,000 

ties  Co.  Deb.  .  . 

4 

1957 

5,595,000  60 
11,163,000  60 

3,357,000 

3,357,000 

N.  H.  Deb . 

4 

1957 

6,697,800 

6,697,800 

Totals . $175,293,351  $76,006,640  $81,044,436 


327 


Summary  of  Results 

Principal  Amount  Bonds  and  Debentures  to  be  Converted  into 

Preferred  Stock . $76,006,640 

Par  Value  of  Preferred  Stock  to  be  Issued  upon  Conversion  .  .  .  81,044,436 

Increase  in  Nominal  Capital .  $5,037,796 

Annual  Interest  Charges  on  Bonds  Converted .  3,641,498 

Annual  Dividend  Charges  on  Preferred  Stock  to  be  issued  upon 

Conversion,  these  charges  being  cumulative  after  Jan.  1,  1927  .  $4,052,222 

Excess  of  New  Contingent  Charges  over  old  Fixed  Charges  .  410,724 

Fixed  Charges  before  Conversion  of  Bonds  (excluding  Marine  and 

Trolley  Items) .  20,077,826 

Reduction  as  above .  3,641,498 

Balance  (excluding  Marine  and  Trolley  Items) . $16,436,328 


TREATMENT  OF  EUROPEAN  LOAN  DEBENTURES 

The  holders  of  the  $24,431,251  of  debentures  of  the  so- 
called  European  loan,  now  maturing  in  1925,  to  accept  new 
6%  First  and  Refunding  Mortgage  Bonds  maturing  No¬ 
vember  1,  1937,  at  par  in  payment  of  thirty  per  cent  of  the 
principal  of  their  debentures.  Forty  per  cent  of  the  prin¬ 
cipal  of  these  debentures  to  be  converted  into  preferred 
stock  as  above  stated,  and  the  balance  to  be  paid  in  cash. 


OTHER  RECOMMENDATIONS 

1.  The  New  Haven  Company  has  guaranteed  dividends 
of  $4  a  share  a  year  on  a  total  of  $6,300,000  (63,000  shares) 


of  preferred  stock  divided  as  follows : 

Boston  Railroad  Holding  Co .  $2,800,000 

New  England  Investment  &  Securities 

Co .  112,100 

Springfield  Railway  Companies .  3,387,900 

Total  $6,300,000 


An  effort  should  be  made  so  to  deal  with  each  of  these 
issues  as  entirely  to  eliminate  the  guarantees  by  the  New 
Haven  Company. 


328 


2.  The  Federal  Government  as  holder  of  $83,646,500  of 
6%  secured  notes  of  the  Company  should  be  requested  to 
fund  this  debt  for  a  reasonable  period,  at  say  four  per  cent 
interest. 

3.  The  New  Haven  Company  as  above  indicated  is  in 
effect  the  guarantor  of  the  rental  ($1,400,000  a  year)  under 
the  lease  from  the  Connecticut  Railway  &  Lighting  Com¬ 
pany  of  its  trolley  and  gas  and  electric  properties.  An 
effort  should  be  made  to  find  a  basis  on  which  the  entire 
guaranty  of  the  New  Haven  Company  can  be  eliminated. 

4.  The  New  Haven  and  the  Pennsylvania  Railroad  are 
joint  guarantors  of  $24,000,000  of  4%%  bonds  of  New  York 
Connecting  Railroad  Company.  The  Connecting  Company 
is  unable  to  meet  its  interest  without  receiving  abnormal 
allowances  from  the  New  Haven  and  the  Pennsylvania, 
so  that  in  fact  the  New  Haven  is  being  called  upon 
under  this  guaranty.  As  the  New  Haven’s  liability  here 
is  unsecured,  and  so  is  of  a  lower  grade  than  most  of 
the  bonds  and  debentures  which  under  the  plan  are  to 
be  converted  in  part  into  preferred  stock,  an  adjust¬ 
ment  with  the  Pennsylvania  should  he  sought  under  which 
the  New  Haven’s  responsibility  for  these  bonds  would  take 
on,  in  part  at  least,  the  character  of  a  contingent  charge 
ranking  with  the  New  Haven’s  preferred  stock  rather  than 
of  a  fixed  charge. 

Though  the  above  plan  is  based  on  figures  as  of  December 
31,  1922,  no  substantial  changes  affecting  the  plan  have 
taken  place  since  that  date. 


329 


APPENDIX  U 

BOSTON  AND  MAINE  RAILROAD 
TENTATIVE  PLAN  FOR  EXTENSION  OF  DEBT 


Preliminary 

The  purpose  of  this  plan  is  to  suggest  such  extensions  of 
the  funded  debt  of  the  Boston  and  Maine  as  will  relieve 
the  company  of  the  burden  of  the  major  part  of  its  matu¬ 
rities  during  the  next  twelve  years  and,  with  the  State  co¬ 
operation  suggested  in  the  committee’s  report,  fully  restore 
the  credit  of  the  company. 

The  plan  presents  a  classified  statement  of  funded  debt 
and  fixed  charges  together  with  a  specification  of  the  debt 
proposed  to  be  extended.  In  formulating  this  classified 
statement,  an  attempt  has  been  made  to  include  the  charges 
resting  upon  all  parts  of  the  system  and  affiliated  com¬ 
panies,  and  to  group  these  charges  in  such  a  manner  as  will 
be  most  convenient  for  reference. 

Throughout  the  plan  an  attempt  is  made  to  give  net 
figures  after  eliminating  inter-company  holdings. 


330 


BOSTON  AND  MAINE  SYSTEM  CAPITALIZATION 

(As  of  December  31,  1922) 


I.  Fixed  Charges 

(Includes  All  Leased  Lines,  and  Lanes  Controlled  by  Stock  Ownership) 

(Excludes  Portland  Terminal  Co.,  Lake  Champlain  &  St.  Lawrence  Ry.,  and 
Montreal  &  Atlantic  Ry.) 


A.  Boston  and  Maine  Company  Obligations 


Item 


Principal 

Amount 


1.  Equipment  Trust  Obligations .  $7,719,600 

2.  Divisional  Liens  (See  detail  p.  331) .  2,838,000 

3.  General  Mortgage  Bonds  held  by  Federal  Govern¬ 

ment  (See  detail  p.  331) .  41,849,479 

4.  Bonds  Secured  by  General  Mortgage  Exclusive  of 

those  held  by  Federal  Government  (See  de¬ 
tail  p.  331) .  72,297,000 

5.  Leased  Line  Stocks  &  Bonds  (See  detail  p.  333)  .  14,701,640 

6.  St.  Johnsbury  &  Lake  Champlain  R.R.  First  Mort¬ 

gage  5s  due  March  1,  1944  .  1,328,000 


Annual 

Charges 

$454,101 

135,710 

2,510,968 


3,056,615 

843,165 

66,400 


Total  Group  A . . $140,733,719  $7,066,959 

B.  Obligations  on  which  Boston  and  Maine  Company  is 
not  liable 

7.  For  detail  see  page  333  .  1,857,000  81,780 

Total  Groups  A  and  B . $142,590,719  $7,148,739 


II.  Capital  Stock 


Par  Value 


First  Preferred : 

Class  A . ' . $18,860,000 

“  B  .  .  . .  7,648,800 

“  C . \.  .  .  .  7,910,300 

“  D .  4,327,000 

“  E .  65,000  $38,811,100 


Preferred .  3,149,800 

Common .  39,473,091 


Total . $81,433,991 


331 


BOSTON  AND  MAINE  SYSTEM  CAPITALIZATION  — 

DETAIL 


DETAIL  OF  ITEM  2:  DIVISIONAL  LIENS 


Principal 

Annual 

Name 

Rate 

Due 

Amount 

Charges 

Troy  &  Boston  R.R.  First  .... 
Worcester,  Nashua  &  Rochester 

7 

July  1,  1924 

$573,000 

$40,110 

R.R.  First . 

Worcester,  Nashua  &  Rochester 

4 

Jan.  1,  1930 

735,000 

29,400 

R.R.  First . 

Portsmouth,  Great  Falls  &  Conway 

4 

Oct.  1,  1934 

380,000 

15,200 

R.R.  First . 

Worcester,  Nashua  <&  Rochester 
R.R.  First . 

4H 

June  1,  1937 

1,000,000 

45,000 

4 

Jan.  1,  1935 

150,000 

6,000 

Total . 

$2,838,000 

$135,710 

DETAIL  OF  ITEM  3:  GENERAL  MORTGAGE  BONDS  HELD  BY 

FEDERAL  GOVERNMENT 


Name 

Boston  &  Maine  Series  C 

Rate 
.  .  6 

Due 

Jan.  1,  1929 

Principal 

Amount 

$10,273,000 

Annual 

Charges 

$616,380 

u  a 

U 

(< 

D 

.  .  6 

Jan.  1,  1929 

15,841,000 

950,460 

u  u 

u 

(( 

G 

.  .  6 

Jan.  1,  1929 

1,212,500 

5,443,979 

72,750 

a  (( 

u 

U 

H 

.  .  6 

Nov.  1,  1930 

326,638 

U  (l 

(( 

u 

J 

.  .  6 

Oct.  1,  1931 

3,049,000 

182,940 

U  (( 

u 

(( 

L 

.  .  6 

Jan.  1,  1929 

1,030,000 

61,800 

u  u 

(( 

u 

K 

.  .  6 

June  1,  1935 

5,000,000 

300,000 

Total 

$41,849,479 

$2,510,968 

DETAIL 

OF  ITEM 

4: 

BONDS 

SECURED  BY 

GENERAL 

MORTGAGE 

EXCLUSIVE  OF  THOSE  HELD  BY  FEDERAL  GOVERNMENT 


A.  Bonds  which  have  already  (June  1923)  matured 


Name 

Boston  &  Maine . 

“  “  “  Connecticut 

River  R.R.  . 
“  “  “  Boston  & 

Lowell  R.R.. 


Rate 

Due 

Principal 

Amount 

Annual 

Charges 

3^ 

Jan.  1,  1923 

$1,896,000 

$66,360 

VA 

Jan.  1,  1923 

969,000 

33,915 

3A 

May  1,  1923 

250,000 

8,750 

Total  Group  A 


§3,115,000  $109,025 


332 


B.  Bonds  maturing  from  June  1,  1923,  to  Dec.  31,  1935 


Boston  &  Maine 

Name 

Rate 

3)4 

Dce 

Feb.  2,  1925 

Principal 

Amount 

$500,000 

Annual 

Charges 

$17,500 

•  «  it 

44 

4 

Sept.  1,  1926 

10,000,000 

400,000 

ti  (1 

44 

4)4 

April  1,  1929 

11,700,000 

526,500 

U  if 

44 

General  Mortgage  Series  F 

6 

June  1,  1930 

3,843,000 

230,580 

ll  «• 

44 

44  44  44 

I 

7 

Jan.  1,  1931 

609,000 

42,630 

Fitchburg  R.R . 

4 

May  1,  1925 

3,660,000 

146,400 

•  (  tl 

4  4  4  4 

4 

Mar.  1,  1927 

2,750,000 

110,000 

Cl  tl 

44 

4  4  4  4 

4 

April  1 ,  1927 

2,000,000 

80,000 

t(  ll 

44 

44  44 

4 

Jan.  1,  1928 

1,450,000 

58,000 

tl  ll 

44 

4  4  44 

4  H 

May  1,  1928 

2,400,000 

108,000 

It  tl 

44 

44  44 

4)4 

Jan.  1 ,  1932 

1,200,000 

54,000 

II  ll 

44 

44  44 

4)4 

Jan.  1,  1933 

400,000 

18,000 

tl  «( 

44 

4  4  4  4 

5 

Jan.  1,  1934 

1,872,000 

93,600 

It  It 

44 

Boston  &  Lowell  R.R.  . 

3)4 

Sept.  1,  1925 

500,000 

17,500 

ti  tl 

44 

44  44  44  44 

4 

Nov.  1,  1926 

500,000 

20,000 

it  ll 

44 

44  4  4  4  4  4  4 

4 

July  1 ,  1927 

325,000 

13,000 

it  ll 

44 

44  4  4  44  44 

m 

4 

April  1 ,  1929 

350,000 

14,000 

ll  ll 

4  4 

44  44  41  44 

4 

April  1 .  1932 

1,000,000 

40,000 

ll  ll 

44 

44  44  44  44 

4)4 

Feb.  1,  1933 

1,000,000 

45,000 

Total  Group  B . 

$46,059,000 

$2,034,710 

C.  Bonds  Maturing  after  Dec.  31,  1935 

Boston  &  Maine  . 

4 

Aug.  1,  1942 

$2,500,000 

$100,000 

it  4  4 

44 

Sinking  Fund . 

4 

Feb.  1.  1937 

1,919,000 

76,760 

44  44 

44 

4)4 

Jan.  1,  1944 

6,000,000 

270,000 

44  4* 

44 

3 

July  1,  1950 

5,454,000 

163,620 

44  44 

44 

Boston  &  Lowell  R.R.  . 

5 

Mar.  1,  1936 

1,250,000 

62,500 

44  44 

4  4 

Fitchburg  R.R . 

4 

Feb.  1,  1937 

5,000,000 

200,000 

44  44 

44 

Connecticut  River  R.R. 

•  ■ 

4 

Sept.  1,  1943 

1,000,000 

40,000 

Total  Group  C . 

$23,123,000 

$912,880 

Total  Groups  A,  B  and  C . 

$72,297,000 

$3,056,615 

333 


DETAIL  OF  ITEM  5:  LEASED  LINE  STOCKS  &  BONDS 


Name  Rate 

Concord  &  Claremont  (N.  H) 

R.R.  Stock . 

Concord  &  Portsmouth  R.R. 

Stock . 7 

Connecticut  &  Passumpsic  River 
R.R.  Preferred  Stock  ....  6 

Nashua  &  Lowell  R.R.  Corp. 

Stock . 9 

Massawippi  Valley  Ry.  Stock.  .  6 

Franklin  &  Tilton  R.R.  Stock  . 

New  Boston  R.R.  Stock  ....  4 

Northern  R.R.  Stock . 6 

Pemigewasset  Valley  R.R.  Stock  6 
Peterborough  R.R.  Stock  ...  4 

Stony  Brook  R.R.  Corp.  Stock  .  7 

Suncook  Valley  R.R.  Stock  .  . 

Troy  &  Bennington  R.R.  Stock.  10 
Vermont  &  Massachusetts  R.R. 

Stock . 6 

Wilton  R.R.  Stock . 8J4 


Principal  Annual 
Due  Amount  Charges 


$700 

350,000 

1,800,000 

800,000 

300,000 

132.800 
60,000 

3,068,400 

503,400 

351,900 

300,000 

278,640 

150.800 

3,193,000 

240,000 


$25,000A 

lll.OOOA 

73,000A 

18,000 

1C 

2,400 

188,9S4A 

30,504A 

14,376A 

21,500A 

. D 

15,400A 

194,580A 

20,400 


Total  Stocks . $11,529,640  $715,145 


Vermont  &  Massachusetts  Ry. 

Plain . 3 V2  May  1,  1923  $772,000E  $27,020B 

Concord  &  Claremont  (N.  H.) 

R.R.  First . .  .  5  Jan.  1,1944  500,000E  25,OOOB 

Connecticut  &  Passumpsic  Rivers 

R.R.  First . 4  April  1,  1943  1,900,000  76,000B 


Total  Bonds .  $3,172,000  $12S, 020 


Total  Stocks  and  Bonds . $14,701,640  $843,165 

Note  A.  Includes  allowances  for  organization  expense:  $500  to  Concord  & 
Portsmouth  R.R.,  $3000  to  Connecticut  &  Passumpsic  Rivers  R.R.,  $1000  to 
Nashua  &  Lowell  R.R.  Corp.,  $5000  to  Northern  R.R.,  $300  to  Pemigewasset 
Valley  R.R.,  $300  to  Peterborough  R.R.,  $500  to  Stony  Brook  R.R.  Corp.,  $320 
to  Troy  &  Bennington  R.R.,  $3000  to  Vermont  &  Massachusetts  R.R. 

Note  B.  Interest  guaranteed  by  Boston  &  Maine. 

Note  C.  Fixed  Rental  $1.00  per  year. 

Note  D.  Operated  without  payment  of  rental. 

Note  E.  Principal  guaranteed  by  Boston  &  Maine. 


DETAIL  OF  ITEM  7:  OBLIGATIONS  ON  WHICH  BOSTON  &  MAINE 

IS  NOT  LIABLE 


Principal  Annual 

Name  Rate  Due  Amount  Charges 

Sullivan  County  R.R.  First  .  .  4  April  1,  1924  $357,000  $14,280 


Total . .  $1,857,000  $81,780 


334 


Extension  of  Bonds 

The  following  Boston  &  Maine  bonds,  maturing  prior  to 
December  31,  1935,  to  be  extended  for  twelve  years,  with 
interest  during  the  period  of  the  extension  at  the  rate  of 
5%  per  annum  in  respect  of  all  bonds  now  bearing  5%  or 
less,  and  at  6%  per  annum  in  respect  of  all  bonds  now 
bearing  six  per  cent  or  seven  per  cent: 

Principal 


Name 

Rate 

Due 

Amount 

Boston  &  Maine . 

.  3M 

Feb.  2,  1925 

$500,000 

.  4 

Sept.  1,  1926 

10,000,000 

.  4  y3 

April  1,  1929 

11,700,000 

General  Mortgage  Series  F  . 

.  6 

June  1, 1930 

3,843,000 

4  4 

««  **  X 

.  7 

Jan.  1,  1931 

609,000 

Fitchburg 

R.R . 

4 

May  1,  1925 

3,660,000 

44 

.  4 

Mar.  1 ,  1927 

2,750,000 

44 

4 

April  1,  1927 

2,000,000 

.  4 

Jan.  1,  1928 

1,450,000 

4  4 

.  4bS 

May  1 ,  1928 

2,400,000 

■  4}4 

Jan.  1,  1932 

1,200,000 

•  4  >4 

Jan.  1 ,  1933 

400,000 

.  5 

Jan.  1 ,  1934 

1,872,000 

44 

Boston  & 

Lowell  R.R.  .  . 

.  zyz 

Sept.  1 ,  1925 

500,000 

44  <4 

4  4  44 

4 

Nov.  1 ,  1926 

500,000 

44  44 

44  44 

.  4 

July  1 ,  1927 

325,000 

44  4 1 

44  44 

.  4 

April  1,  1929 

350,000 

.  4 

April  1,  1932 

1,000,000 

44  44 

.  4^ 

Feb.  1,  1933 

1,000,000 

Total 

$46,059,000 

The  above  constitute  all  the  Boston  &  Maine  bonds  ma¬ 
turing  prior  to  December  31,  1935,  with  the  exception  of 
equipment  trust  obligations,  of  bonds  held  by  the  Federal 
Government,  of  bonds  secured  by  underlying  mortgages, 
and  of  the  bonds  next  mentioned. 

The  $4,000,000  of  6%  General  Mortgage  Series  M  Bonds, 
dated  January  1,  1923,  due  January  1,  1933,  to  be  similarly 
extended  for  twelve  years.  These  bonds  are  not  listed  in  the 
above  statement  for  the  reason  that  the  statement  is  made 
up  as  of  December  31,  1922,  and  the  bonds  are  dated 
January  1,  1923. 


BOSTON  COLLEGE 


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